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Home Depot won鈥檛 raise prices from tariffs

Home Depot won鈥檛 raise prices from tariffs
This is *** mixed report. After falling in last month's data, we know that inflation went up 0.2% year over year it's up 2.3%, which is about where it was last month. According to the Bureau of Labor Statistics, rising rent, natural gas, and electricity offset decreases in gas, groceries, used vehicles, and clothing. Prices across the board are in limbo as consumers. To feel the full impact of President Trump's tariffs. And while the Trump administration works out *** trade deal with China, agreeing to *** 90 day truce, many companies are likely using that time to stockpile on goods, bringing in an influx of trade and buying, but minimal relief when it comes to inflation. It takes so long for orders to be placed to be put on *** ship to make it across the ocean. Uh, and then to make it to their destinations in the United States. It takes *** long time to plan for those things. 90 days, uh, of uncertainty about what will happen next is not *** lot of confidence for, uh, importers. And the economists who we spoke with say that tariffs impact more than just prices. In the short term, he says it could prevent many companies from hiring more and broadening their operations. In Washington, I'm Amy Lo.
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Home Depot won鈥檛 raise prices from tariffs
Home Depot said it doesn鈥檛 plan to raise prices because of President Donald Trump鈥檚 tariffs, breaking with Walmart and other retailers that will pass costs related to the trade war on to consumers.鈥淏ecause of our scale, the great partnerships we have with our suppliers and productivity that we continue to drive in our business, we intend to generally maintain our current pricing levels across our portfolio,鈥� finance chief Richard McPhail told CNBC in an interview.McPhail said the home improvement retailer has diversified where it sources its merchandise and reduced its reliance on China. More than half of Home Depot鈥檚 products come from the United States.But the trade war has begun to hurt Home Depot. Consumer sentiment has plunged near record lows as Americans fear tariffs will reignite inflation and weaken the economy. That, in part, kept some customers away from the home improvement behemoth.Home Depot reported sluggish earnings Tuesday, weighed down by a weak housing market and consumers taking on fewer large-scale renovation projects. Sales at U.S. stores open for at least one year increased 0.2% last quarter.Video below: Can America return to manufacturing?Holding prices steadyA wave of companies have announced price hikes because of the added costs of tariffs, but Home Depot is a rare standout.Many of Home Depot鈥檚 competitors and suppliers have been raising prices to mitigate cost increases from the 10% universal tariffs on every product entering the United States and higher levies on Chinese goods. Washington and Beijing reached an agreement to lower those tariffs last week, but the United States still charges a 30% levy on most goods coming from China.Home Depot has also caught a break so far on lumber tariffs, a major part of its business. But that could change soon. About 30% of the softwood lumber consumed in the U.S. is imported, with Canada accounting for more than 80% of those imports. Lumber is expected to soon face a tariff hike.In April, Stanley Black & Decker, the owner of Dewalt, Craftsman, Black + Decker and other power tool brands, raised prices by an average of high single-digits because of tariffs. It plans to introduce a second round of increases later in the year, the company said on an earnings call.Walmart said Trump鈥檚 tariffs are 鈥渢oo high鈥� and it will raise prices on some items as Trump鈥檚 global trade war increases the company鈥檚 costs.鈥淲e 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鈥檛 able to absorb all the pressure given the reality of narrow retail margins,鈥� Walmart CEO Doug McMillon said last week on an earnings call.鈥淭he higher tariffs will result in higher prices,鈥� he said.Trump is using his bully pulpit to publicly shame Walmart and other companies that hike prices because of tariffs, making companies鈥� price decisions more fraught.鈥淲almart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,鈥� Trump said over the weekend. 鈥淏etween Walmart and China they should, as is said, 鈥淓AT THE TARIFFS,鈥� and not charge valued customers ANYTHING. I鈥檒l be watching, and so will your customers!!!鈥漈rump has also attacked Amazon and Mattel for considering price hikes.

Home Depot said it doesn鈥檛 plan to raise prices because of President Donald Trump鈥檚 tariffs, breaking with Walmart and other retailers that will pass costs related to the trade war on to consumers.

鈥淏ecause of our scale, the great partnerships we have with our suppliers and productivity that we continue to drive in our business, we intend to generally maintain our current pricing levels across our portfolio,鈥� finance chief Richard McPhail told in an interview.

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McPhail said the home improvement retailer has diversified where it sources its merchandise and reduced its reliance on China. More than half of Home Depot鈥檚 products come from the United States.

But the trade war has begun to hurt Home Depot. Consumer sentiment has plunged near record lows as Americans fear tariffs will reignite inflation and weaken the economy. That, in part, kept some customers away from the home improvement behemoth.

Home Depot reported sluggish earnings Tuesday, weighed down by a weak housing market and consumers taking on fewer large-scale renovation projects. Sales at U.S. stores open for at least one year increased 0.2% last quarter.

Video below: Can America return to manufacturing?

Holding prices steady

A wave of companies have announced price hikes because of the added costs of tariffs, but Home Depot is a rare standout.

Many of Home Depot鈥檚 competitors and suppliers have been raising prices to mitigate cost increases from the 10% universal tariffs on every product entering the United States and higher levies on Chinese goods. Washington and Beijing reached an agreement to lower those tariffs last week, but the United States still charges a 30% levy on most goods coming from China.

Home Depot has also caught a break so far on lumber tariffs, a major part of its business. But that could change soon. About 30% of the softwood lumber consumed in the U.S. is imported, with Canada accounting for more than 80% of those imports. Lumber is expected to soon face a tariff hike.

In April, Stanley Black & Decker, the owner of Dewalt, Craftsman, Black + Decker and other power tool brands, by an average of high single-digits because of tariffs. It plans to introduce a second round of increases later in the year, the company said on an earnings call.

Walmart said Trump鈥檚 tariffs are 鈥渢oo high鈥� and it will raise prices on some items as Trump鈥檚 global trade war increases the company鈥檚 costs.

鈥淲e 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鈥檛 able to absorb all the pressure given the reality of narrow retail margins,鈥� Walmart CEO Doug McMillon said last week on an earnings call.

鈥淭he higher tariffs will result in higher prices,鈥� he said.

Trump is using his bully pulpit to publicly shame Walmart and other companies that hike prices because of tariffs, making companies鈥� price decisions more fraught.

鈥淲almart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,鈥� Trump said over the weekend. 鈥淏etween Walmart and China they should, as is said, 鈥淓AT THE TARIFFS,鈥� and not charge valued customers ANYTHING. I鈥檒l be watching, and so will your customers!!!鈥�

Trump has also attacked Amazon and Mattel for considering price hikes.