Businesses Across the U.S. Pass Tariff Costs to Consumers, Fed's 'Beige Book' Finds

The Federal Reserve's 'beige book,' a report on regional economic conditions, has found that businesses across the U.S. are beginning to pass tariff costs to consumers. This trend is a concern for the Fed, as it could lead to higher prices and reduced consumer spending.

The 'beige book' is a compilation of reports from the 12 Federal Reserve districts, which provide insight into regional economic conditions. The latest report, released on January 14, 2026, found that only two of the 12 districts reported slight price growth, while the rest saw higher costs.

The passing of tariff costs to consumers is a trend that has been observed in various industries, including manufacturing and retail. This is a concern for the Fed, as it could lead to higher prices and reduced consumer spending. The Fed is closely monitoring this trend and will continue to assess its impact on the economy.

Impact on Consumers

The passing of tariff costs to consumers will likely lead to higher prices for goods and services. This could have a negative impact on consumer spending, which is a key driver of economic growth. Consumers may be forced to reduce their spending or seek out cheaper alternatives, which could have a ripple effect throughout the economy.

Industry Impact

The passing of tariff costs to consumers will also have an impact on various industries, including manufacturing and retail. Companies that rely on imported goods may be forced to raise their prices to cover the cost of tariffs, which could lead to reduced sales and profitability.

Fed's Response

The Fed is closely monitoring the trend of passing tariff costs to consumers and will continue to assess its impact on the economy. The Fed may consider taking action to mitigate the effects of tariffs, such as adjusting interest rates or implementing policies to support businesses and consumers.

Conclusion

The passing of tariff costs to consumers is a trend that is being closely monitored by the Fed. This trend has the potential to lead to higher prices and reduced consumer spending, which could have a negative impact on the economy. The Fed will continue to assess the impact of tariffs and consider taking action to mitigate their effects.

Sources

[1] Businesses across the U.S. are beginning to pass tariff costs to consumers, Fed’s ‘beige book’ finds