The Commercial Real Estate Alpha Site

Atlanta Fed President Raphael Bostic warned that American companies are running out of room to shield consumers from tariff-related cost increases. For months, businesses have relied on stockpiled goods and thinner profit margins to delay passing those costs along. But now, Bostic says that buffer is nearly gone, which could reintroduce pricing pressure into an economy that’s only recently begun cooling.

Inflation could soon get a second wind, not from labor or energy, but from trade. If businesses start pushing through price hikes, the Fed may be forced to keep interest rates elevated longer than markets expect. That keeps pressure on rate-sensitive sectors like housing and consumer discretionary, and it means investors betting on a smooth disinflation narrative may be in for a rethink.