{"id":56273,"date":"2025-05-15T15:15:12","date_gmt":"2025-05-15T15:15:12","guid":{"rendered":"https:\/\/prosfunds.com\/?p=56273"},"modified":"2025-05-15T15:15:16","modified_gmt":"2025-05-15T15:15:16","slug":"walmart-says-tariffs-will-lead-to-higher-prices-despite-us-china-deal","status":"publish","type":"post","link":"https:\/\/prosfunds.com\/?p=56273","title":{"rendered":"Walmart says tariffs will lead to higher prices despite US-China deal"},"content":{"rendered":"<div>\n<p>Unlock the Editor\u2019s Digest for free<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\"><span>Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.<\/span><\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=330c484e-40c2-4d92-9768-f7336acbe9c9\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>Walmart has warned Americans will pay higher prices because of Donald Trump\u2019s trade war, despite this week\u2019s deal between the US and China to slash punitive tariffs.<\/p>\n<p>The world\u2019s biggest retailer is particularly exposed to the president\u2019s sweeping global trade levies. A third of the goods it sells in the US come from other countries, with China one of its largest sources of imports. <\/p>\n<p>Washington and Beijing agreed this week to a cut in tariffs for 90 days, reducing US levies on Chinese imports to about 40 per cent, from as high as 145 per cent. <\/p>\n<p>Doug McMillon, Walmart\u2019s chief executive, said the reprieve was not big enough to avert price rises for its hundreds of millions of customers. <\/p>\n<p>\u201cWe will do our best to keep our prices as low as possible, but given the magnitude of the tariffs, even at the reduced levels announced this week, we aren\u2019t able to absorb all the pressure,\u201d he said. \u201cThe higher tariffs will result in higher prices.\u201d <\/p>\n<p>Walmart sells about a quarter of US groceries, and has long served as a benchmark for the lowest overall prices in the industry. <\/p>\n<p>McMillon was among the retail bosses to argue against tariffs at the White House last month, warning Trump of higher prices and empty store shelves. <\/p>\n<p>Trump pulled back from the trade war under pressure from business leaders and a market rout. He paused sweeping levies on dozens of trading partners in April after a week, and has promised a rush of new trade deals. <\/p>\n<p>The deal with China, which followed an agreement with the UK last week, marked Trump\u2019s most significant climbdown. <\/p>\n<p>But McMillon said the retreat would not be enough to protect US consumers from price increases, threatening the economy and a resurgence of inflation. <\/p>\n<p>Walmart would try to keep a lid on food prices after years of grocery inflation, McMillon said. But he said there were new tariff pressures for products it needs to import, such as bananas from Costa Rica and coffee from Colombia. <\/p>\n<p>The warning from McMillon on Thursday came as Walmart reported a 4.5 per cent annual increase in comparable sales at its namesake US business in the three months to the end of April, surpassing the 3.7 per cent rise forecast by Wall Street analysts, according to Visible Alpha. <\/p>\n<p>The retailer maintained its financial guidance for the full year, which includes a projection of 3 to 4 per cent growth in net sales. However, it withheld guidance on profits in the second quarter, citing the uncertain trade picture. Shares fell 3.22 per cent in early New York trading. <\/p>\n<p>John David Rainey, chief financial officer, said it was difficult to predict how consumers would react to the tariffs, and what level of price rises would start to reduce demand. <\/p>\n<p>The heavy tariffs on China were already raising prices for products including electronic and toys, McMillon said. <\/p>\n<p>The Walmart boss said cost pressure began in April, and increased in May. He said price increases for goods other than groceries were likely to continue all year. <\/p>\n<p>Walmart will try to shift the sourcing of manufactured goods away from tariff-hit locations and change some product components, such as using fibreglass instead of aluminium, a metal subject to US duties. <\/p>\n<p>Mexico, Canada, Vietnam and India are major sources of Walmart\u2019s imports, alongside China. <\/p>\n<p>Walmart is the first big-box retailer to report earnings since Trump\u2019s April tariff announcements. Target and Home Depot will follow next week. <\/p>\n<p>Amazon this month warned tariffs and trade policies posed risks to earnings, but the company did not report any slackening of demand or any significant rise in average selling prices on its platform. <\/p>\n<p>Walmart reported that its ecommerce business \u2014 which includes sales from its own inventory and from third-party merchants using its platform \u2014 grew 22 per cent year on year and was profitable in both the US and globally for the first time. <\/p>\n<p>Trade war jitters prompted shoppers to speed up purchases of some items in an attempt to beat the tariffs, potentially distorting the picture of consumer demand. <\/p>\n<p>Walmart reported quarterly revenue of $165.6bn, up 2.5 per cent year on year and slightly below forecasts of $166bn, according to Visible Alpha. Net income fell 12.6 per cent to $4.6bn, marginally more than the consensus. <\/p>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.ft.com\/content\/330c484e-40c2-4d92-9768-f7336acbe9c9\" target=\"_blank\" rel=\"noopener\" rel=\"nofollow\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Unlock the Editor\u2019s Digest for free Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. Walmart has warned Americans will pay higher prices because of Donald Trump\u2019s trade war, despite this week\u2019s deal between the US and China to slash punitive tariffs. The world\u2019s biggest retailer is particularly exposed to [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":56274,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[23],"tags":[],"class_list":{"0":"post-56273","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Walmart says tariffs will lead to higher prices despite US-China deal | Prosfunds<\/title>\n<meta name=\"description\" content=\"Unlock the Editor\u2019s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.Walmart has warned Americans\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link 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