Yale Budget Lab The price level from all 2025 tariffs rises by 1.8% in the short-run, the equivalent of an average per household income loss of $2,400 in 2025$. This assumes the Federal Reserve does not react to tariffs and so the real income adjustment comes primarily through prices rather than nominal incomes; if the Federal Reserve reacted, the adjustment could in part come in the form of lower nominal incomes. Annual pre-substitution losses for households at the bottom of the income distribution are $1,300. The post-substitution price increase settles at 1.5%, a $2,000 loss per household.