Ralph McLaughlin

Price growth for consumer durables and personal goods once again accelerated on a monthly basis in June, with a month-over-month increase of 0.76% compared to a revised monthly 0.48% increase in May. Price growth was driven primarily by acceleration of communication, personal care, and recreation products. Across the largest moving categories in June 2025, price growth acceleration was concentrated among hair dryers, headphones, mowers, printers, and printer ink, with monthly increases of between +0.6% and 2.0%.

• Key CPI Takeaways for June 2025 & Macroeconomic Outlook
• Product Group Highlights
  • Appliances
  • Communication
  • Home Improvement
  • Personal Care
  • Recreation
• CPI 2025 Forecast: Macroeconomic Summary
• Methodology

Now that the first half of 2025 is behind us, an important question to ask is: which product categories have seen the largest price increases since the beginning of the year? Simply put, the largest increases have been among consumer electronics and appliances, with the top 10 categories in price growth showing a net annual increase of between 4.2% and 2.6%

Consumer tech and kitchen gear saw the sharpest price jumps in the first half of 2025.

• Sound bars led with a 4.2% increase, followed by headphones (3.8%) and over-the-range microwaves (3.7%).

• Home office essentials weren’t far behind—monitors, printers, and ink rose between 3.1%–3.5%, signaling ongoing demand for hybrid work setups.

• Hair dryers and TVs ticked up 3.0%, while toner and laundry appliances saw more modest hikes of 2.7% and 2.6%.

Across the board, electronics and appliances continue to feel inflationary pressure, with entertainment and work-from-home gear leading the charge.

Overall OpenBrand Consumer Price Index Movement: The OpenBrand CPI of Durable and Personal Goods recorded a +0.76% monthly change in June, notching the seventh consecutive month-over-month increase and 12th of the last 13th, as retailers continue passing along some of the costs of their import tariffs to consumers. The magnitude of price change also accelerated in June, with yet another considerable increase over the prior month’s increase of +0.48%.

Discount Trends: June again brought very slight changes to the frequency and magnitude of discounts to the durables and personal goods sector, with frequencies rising month-over-month to 21.2% of all durable and personal goods from 20.5% in the month prior, and the typical magnitude remaining unchanged at 19.5%. How is it possible that prices could rise while the frequency of discounts increases? Simply put, retailers are likely using psychological warfare to soften the blow of price increases by increasing the list price of products while discounting more of them to a shelf price that is higher than prior months. 

Product Group Price Trends: Three product groups – Communications, Personal Care, and Recreation – all experienced sharp increases in price growth from the prior month, while two groups –  Appliances and Home Improvement – experienced positive but slowing rates of price growth.

• Appliance Group (+0.29%)
• Communication Group (+0.86%)
• Home Improvement Group (+0.39%)
• Personal Care Group (+0.58%)
• Recreation Group (+1.51%)

See the full breakdown of product groupings. 

CPI: Appliances

Prices for appliances increased by +0.29% on a month-over-month basis in June, slowing from a revised decrease of 0.77% in the month prior. The deceleration in price growth was at least partially driven by an increase in the frequency of discounts (42.6% from 40.6% the month prior), while the typical discount magnitude remained unchanged at 16.5% The trend remains relatively stable at between 38% and 43% for frequencies, and mid-teens for discounts, since May 2024.

CPI: Communication

Prices of communication devices, including phones, tablets, computers, and printers, rose on a month-over-month basis to 0.86%, up from a revised 0.25% the month prior. While both the frequency and magnitude of discounts increased in June, from 7.74% to 9.84% and 19.0% to 19.9%, respectively, net prices are still rising at least in part because sellers are also raising their list prices while maintaining, and even expanding, existing discounts to take the sting out of rising prices.

CPI: Home Improvement

The index for home improvement goods decelerated to +0.39% on a month-over-month basis, showing 26 consecutive month-over-month flat or monthly increases but down from +0.78% May. The increase in prices comes amidst increases in both the frequency (rising to 12.7% from 11.0%) and magnitude (rising to 17.9% from 17.0%), suggesting that retailers of home improvement goods continue to increase their list prices while maintaining and even increasing promotional discounts in order to help ease the sting of rising prices.

CPI: Personal Care

Prices of personal care products increased sharply again on a monthly basis in June 2025 by +0.58%, up from +0.19% in May. This increase comes during changes in both the frequency and magnitude of discounts, with the frequency increasing to 21.9% from 19.4%, while the typical discount magnitude decreased from 21.5% in May to 21.2% in June.

CPI: Recreation

Prices of recreational products, including TVs, headphones, and speaker systems, increased sharply by +1.77% on a month-over-month basis in June, up from a revised +0.42% in May. This is the 12th increase over the past 13 months. Some of this sharp increase in the pace of price growth is at least partially due to a sharp decrease in the frequency of discounts – to 18.9% in June from 23.6% in May – and a slight decrease in the average magnitude of discounts – to 22.2% from 23.4% over the same time period. 

As of mid-2025, global price growth continues to moderate from the post-pandemic highs seen in 2022 and 2023. However, inflation remains uneven across sectors and regions due to lingering supply-side constraints, tariff-driven cost pressures, and resilient demand in key service industries. Policymakers are now navigating a narrow path: ensuring inflation continues to fall without triggering a sharp economic slowdown.

Inflation in most advanced economies has eased to around 2–3%, down from double-digit peaks. Emerging markets have seen more variation, with some countries experiencing renewed inflation due to currency depreciation and energy price volatility. In the United States, headline inflation ticked up slightly in Q2 2025, driven by new tariffs on goods from China and Mexico, as well as seasonal increases in travel, energy, and food prices. Core inflation, however, is trending downward, suggesting a gradual return to the Federal Reserve’s 2% target, as the influence of pandemic-era bottlenecks wanes.

While our data shows inflation for durable and personal goods accelerated again in June, our outlook for July is more modest, especially given last week’s announcement (Monday, July 7) that the reciprocal tariff deadline – originally planned for July 9th – would be extended to August 1st. 

Also in the announcement, President Trump set out plans for a 40% tariff on goods from Myanmar and Laos, a 36% tariff on goods from Thailand and Cambodia, a 35% tariff on goods from Serbia and Bangladesh, a 32% tariff on Indonesia, a 30% tariff on goods from South Africa and a 25% tariff on goods from Japan, Malaysia, South Korea, and Tunisia. If these tariffs are indeed implement on August 1st, we could see inflation continue to rise well into 2025Q3 and beyond.

Key Drivers of Price Growth in 2025 H2

New tariffs imposed in early 2025, especially by the U.S., are adding to the cost of durable goods, electronics, and construction materials. Firms are passing some of these costs to consumers. Labor markets remain tight in many economies, especially in healthcare, education, and hospitality, contributing to persistent services inflation. Oil prices rose modestly due to production cuts by major exporters and ongoing geopolitical uncertainty in the Middle East and Eastern Europe. Food prices have been volatile due to extreme weather events disrupting supply chains. Increased use of AI and automation in logistics, retail, and manufacturing is helping to mitigate some inflationary pressures, particularly in goods-producing sectors.

Sector Highlights

Consumer Durables: Prices are rising modestly due to tariffs and global shipping costs, especially among products that did not qualify for the April 2025 tariff exemptions, which covered products like smartphones, computers, laptops, monitors, memory cards, semiconductor devices, modems, routers, and flat panel displays 

Housing: The housing market is poised to have one of the slowest non-recessionary years in recent history. Higher mortgage rates are dampening demand, but limited inventory is keeping prices elevated in some urban areas.

Healthcare and Education: These sectors continue to see above-average inflation due to labor intensity and limited productivity gains.

Transportation: Airline and automotive prices are elevated compared to last year, driven by fuel costs and supply chain rebuilding.

Monetary Policy Outlook

Central banks, including the Federal Reserve and the European Central Bank, have paused interest rate hikes but remain cautious. Markets anticipate potential rate cuts in late 2025 or early 2026, contingent on further inflation moderation and stable labor markets. Policymakers are wary of cutting too soon and reigniting inflationary pressures, especially in politically sensitive sectors like housing and food.

How Will the One Big Beautiful Bill Affect the U.S. Economy and Inflation?

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduces significant changes to U.S. fiscal policy, with immediate and long-term implications for the economy and inflation.

In the near term, the OBBBA is expected to provide a modest boost to economic growth. Analyses suggest an average GDP increase of 0.2 to 0.4 percentage points annually through 2027, primarily due to tax cuts and increased government spending . Proponents argue that these measures will enhance consumer spending and business investment. However, critics caution that the benefits may be unevenly distributed and could exacerbate income inequality .

Over the next decade, the OBBBA is projected to significantly increase the federal deficit. The Congressional Budget Office estimates an addition of $2.8 trillion to the national debt by 2034 . 

These fiscal changes may lead to higher interest rates and reduced private investment, potentially slowing long-term economic growth .

The substantial increase in government spending and tax cuts could exert upward pressure on inflation. Additionally, the weakening of the U.S. dollar and potential reluctance from foreign investors to purchase U.S. debt could further complicate monetary policy .

The OBBBA rolls back several clean energy initiatives, including tax credits for renewable energy and electric vehicles. These changes could increase household energy costs and result in significant job losses in the clean energy sector.

The legislation introduces work requirements for Medicaid and SNAP recipients and reduces funding for these programs. The Congressional Budget Office estimates that approximately 10.9 million Americans could lose health insurance coverage as a result. Such changes could lead to increased medical debt and adverse health outcomes, particularly among low-income populations.

While the One Big Beautiful Bill Act aims to stimulate economic growth through tax cuts and increased spending, it raises concerns about long-term fiscal sustainability, inflation, and the well-being of vulnerable populations. The legislation’s impact on clean energy initiatives and social programs may have lasting effects on the U.S. economy and public health, but could spur economic growth in the short-run through new and extended tax cuts to middle and higher-income workers.

Note: This summary is based on data available as of early July 2025 and may be subject to revisions in future releases.

For questions about the report, please contact Ralph McLaughlin at ralph@openbrand.com 

For press inquiries, please contact press@openbrand.com 

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.

Price growth for consumer durables and personal goods accelerated sharply on a monthly basis in May, with a month-over-month increase of 0.53% compared to a revised monthly 0.35% increase in April. Price growth was driven primarily by acceleration of appliances, home improvement, and personal care products. Across the largest moving categories, price growth acceleration was concentrated in acne care, dishwashers, hair styling products, countertop microwaves, outdoor cooking, shaving razors, sound bars, and TVs, with monthly increases of between +1.24% and 2.92%.

We attribute some of the recent acceleration in price growth to the continued and varied enforcement of U.S. tariffs on specific product types. The tariffs have targeted a wide range of goods imported from China and other major U.S. trading partners, and span a variety of goods covered in our CPI basket. What’s more, some products – particularly those imported from China that aren’t part of the April exclusion with a high turnover- are more susceptible to the impacts of tariffs than others, as importers and retailers of such goods face increasing pressure to pass costs onto consumers. For example, prices for items like acne care, dishwashers, hair styling products, countertop microwaves, outdoor cooking, shaving razors, sound bars, and TVs accelerated the most, with an acceleration of price growth across these categories from -2.93% to -0.45% in April to +1.24% to 2.92% in May. 

Overall OpenBrand Consumer Price Index Movement: The OpenBrand CPI of Durable and Personal Goods recorded a 0.53% monthly change in May, notching the sixth consecutive month-over-month increase as retailers begin passing along some of the costs of their import tariffs to consumers. The magnitude of price change accelerated again in May, with a considerable increase over last month’s increase of 0.35%.

Discount Trends: May again brought very slight changes to the frequency and magnitude of discounts to the durables and personal goods sector, with frequencies rising month-over-month to 21.2% of all durable and personal goods from 21.1% in the month prior, and the typical magnitude remaining unchanged at 19.5%. Given lingering uncertainty surrounding the current state of trade negotiations, we expect discounting activity to remain steady, or even decrease, over the coming months. 

Product Group Price Trends: Three product groups – Appliances, Home Improvement, and Personal Care – all experienced sharp increases in price growth from the prior month, while two groups –  Communication and Recreation – experienced positive but slowing rates of price growth.

• Appliance Group (+0.77%)
• Communication Group (+0.14%)
• Home Improvement Group (+0.81%)
• Personal Care Group (+5.6%)
• Recreation Group (+3.6%)

See the full breakdown of product groupings. 

CPI: Appliances

Prices for appliances increased sharply by +0.77% on a month-over-month basis in May, accelerating from a revised decrease of 0.09% in the month prior. The acceleration in price growth was at least partially driven by a small decrease in both the frequency (40.7% from 41.3% the month prior) and magnitude (16.8% from 16.6%) of discounts, but the trend has been relatively stable at between 38% and 43% for frequencies, and mid-teens for discounts, since May 2024.

CPI: Communication

Prices of communication devices, including phones, tablets, computers, and printers, rose on a month-over-month basis to 0.14%, down from a revised 0.97% the month prior. Some of the slowdown in price growth was likely due to an increase in both the frequency and magnitude of discounts. The frequency of discounts increased over the month from 5.5% in April to 7.9% in May, but both months were down by about half since May 2024, when they ranged from about 12.0% to 14.5%. The magnitude of discounts decreased by just 30 basis points, from 18.7% in April to 19.0% in May.

CPI: Home Improvement

The index for home improvement goods increased sharply in May to +0.81% on a month-over-month basis, showing 26 consecutive month-over-month flat or monthly increases and up from +0.59% April. The increase in prices comes amidst relatively minor changes in both the frequency and magnitude of discounts, suggesting that such price changes are being driven by upward adjustments in shelf pricing. The frequency of discounts was 11.1% of products in May, down from 12.1% in April. In addition to the decrease in the share of products with a discount, the magnitude of discounts also decreased slightly month-over-month, falling from 17.4% in April to 16.9% in May. 

CPI: Personal Care

Prices of personal care products increased sharply on a monthly basis in May 2025 by 0.56%, a strong reversal of trends of -0.14% in March and -0.39% in April. This increase comes during changes in both the frequency and magnitude of discounts, with the frequency decreasing by 140 basis points from 24.0% in April to 22.6% in May. The typical discount magnitude increased very slightly, from 21.2% in April to 21.3% in May.

CPI: Recreation

Prices of recreational products, including TVs, headphones, and speaker systems, increased by 0.36% on a month-over-month basis in May, down from a revised 0.70% in April. This is the tenth increase over the past eleven months. Some of this slowdown in the pace of price growth is at least partially due to an increase in the frequency of discounts – to 23.8% in May from 22.8% in April – and a slight increase in the average magnitude of discounts – to 23.5% from 23.3% over the same time period.

The U.S. economy has entered a period of moderated growth, shaped heavily by trade policy developments and persistent inflationary pressures. Following a strong 2024, economic momentum softened in early 2025. The first quarter saw a -0.3% contraction in real GDP, primarily driven by a front-loaded surge in imports as businesses moved to circumvent new tariffs introduced under the Trump administration. Despite the contraction, domestic demand remains relatively healthy, with consumer spending and capital investment providing ongoing support. Our outlook still assumes the U.S. economy avoids a recession in 2025, with full-year GDP growth expected to land at 1.3%, increasing to 1.5% in 2026. Growth will remain below trend, however, and macroeconomic risks remain elevated.

The Federal Reserve has held its policy rate steady at 4.25%–4.5%, though we expect it to begin cutting rates in Q3 and assume this will be a response to a continued slowdown in economic activity. Markets now anticipate three 25-basis-point cuts in the second half of 2025, eventually bringing the federal funds rate closer to its estimated neutral level of 3% by 2026. Long-term yields are expected to stay near 4.2%, as elevated inflation and fiscal concerns limit downward pressure.

While headline BLS CPI and BEA PCE inflation has decelerated in recent months, as we show below this improvement may be temporary. New tariffs implemented in April are expected to reaccelerate inflation in the second half of the year. That said, our forecast is that the BLS CPI will peak near 2% on a year-over-year basis for consumer durables before returning to a deflationary trend that existed prior to the current tariff environment.

Labor market conditions remain solid but are softening. April saw a gain of 177,000 jobs, with unemployment holding at 4.2%. Job growth is expected to slow into 2026, with the unemployment rate projected to reach 4.9% by year-end 2026. The 2025 forecast includes approximately 900,000 new jobs, though the labor market is expected to flatline next year.

Tariffs remain the most influential policy lever impacting the near-term outlook. The effective tariff rate is projected to peak around 20% by mid-2025, gradually falling to 8% by the end of President Trump’s term. While some sectors experienced a short-term boost from inventory stockpiling, the broader economic impact is negative—particularly for import-reliant industries and capital-intensive sectors facing rising input costs.

The housing sector is under pressure from rising materials costs and a constrained labor supply due to immigration restrictions. While underlying demand remains intact, affordability challenges and elevated mortgage rates are limiting both new starts and existing home sales. National home prices are expected to post low single-digit growth. In commercial real estate, persistent vacancy rates and high borrowing costs are weighing on valuations, though “extend-and-pretend” lending strategies are preventing widespread distress.

Key Risks to Monitor, Summer 2025:

• Downside: Sustained or escalating tariffs, renewed inflation shocks, tighter financial conditions, or a deterioration in global growth.
• Upside: Faster easing of trade tensions, stronger-than-expected labor force growth, or a sustained rebound in productivity.

In summary, the June 2025 outlook reflects a U.S. economy in transition—moving from recovery to a slower, more fragile expansion. Monetary policy easing is likely, but contingent on inflation trends. Trade policy will remain a primary driver of macroeconomic volatility in the months ahead, and internal planning should reflect both the potential for policy normalization and elevated downside risk.

Note: This summary is based on data available as of early June 2025 and may be subject to revisions in future releases.

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.

Price growth for consumer durables and personal goods accelerated on a monthly basis in April, with a sharp month-over-month increase of 0.35% compared to a revised monthly 0.12% increase in March. Price growth was driven primarily by upward price movements of communications devices and equipment, home improvement items, and recreational goods. Across the largest moving categories, price growth acceleration was concentrated in desktop computers, headphones, ink, monitors, notebooks, projectors, power tools, and toner, with monthly increases of between +0.63% and 1.98%.

Given general deflationary trends at the end of last year and the beginning of this year, we suspect some of the recent acceleration in price growth was driven in part by the implementation of U.S. tariffs over the past few months. The tariffs have targeted a wide range of goods imported from China and other major U.S. trading partners, and span a variety of goods covered in our CPI basket, including electronics, tools, and other everyday consumer products. As importers of goods from newly tariffed countries faced higher costs, it’s likely many passed those increases along to retailers and, ultimately, consumers. 

Prices for items like desktop computers, headphones, ink, monitors, notebooks, projectors, power tools, and toner accelerated the most, with an acceleration of price growth across these categories from 0% – 0.3% in March to 0.63%-1.98% in April. It’s likely that not only have such tariffs raised import costs, but also strained supply chains, compounding upward pressure on prices and adding uncertainty to the economic outlook. The good news, however, is that there appears to be a willingness of the Trump administration to cut trade deals in the coming months. As such, we anticipate inflation to be more transient in nature throughout the remainder of the year as trade deals get inked.

Macroeconomic Outlook Update: The U.S. economy is now exhibiting mixed signals. On one hand, the labor market remains resilient—April saw a stronger-than-expected addition of 177,000 jobs. On the other hand, early GDP estimates reflect a modest contraction in Q1, driven in part by front-loaded inventory accumulation ahead of tariff hikes. As reported in this report as well as from official government sources, iInflation continues to trend above the Federal Reserve’s 2% target, fueled by rising import prices and supply chain adjustments. Core goods inflation is up, while services inflation remains sticky.

Financial markets are responding cautiously. The S&P 500, after a sharp drop earlier in the year, is stabilizing but remains volatile. Business confidence has dipped, particularly in manufacturing and construction, which are sensitive to input costs and global demand shifts. The Fed is expected to hold interest rates steady through the summer while assessing the full impact of trade measures on inflation and growth.

Looking ahead, the global economic outlook for the second half of 2025 will depend heavily on policy responses—particularly whether central banks can maintain credibility while navigating between inflation control and supporting growth. The baseline scenario points to slower but positive growth in the U.S. and modest recovery potential in Europe and Asia. However, risks are tilted to the downside, primarily due to geopolitical tensions, trade fragmentation, and tighter financial conditions. As mentioned last month, the long-term impact on prices and macroeconomic conditions from current trade tensions is less clear, and will depend upon other factors such as Federal Reserve Board interest rate decisions, household and/or business tax cuts, and the outcome of ongoing multilateral trade negotiations.

Today’s announcement of cooling trade tensions between the U.S. and China – which has led to a reduction of tariffs on imports from China to 30% for 90 days – is a positive step that indicates a full-on trade deal is in the works. That said, 30% is larger than the 20% that has remained in effect over the past month, so we won’t fully expect price pressures to ease – or turn negative – until effective tariffs on durable and personal goods from China fall back down below that 20% threshold.

Overall Index Movement: The OpenBrand CPI of Durable and Personal Goods recorded a 0.35% monthly change in April, notching the fifth consecutive month-over-month increase as retailers continue to grapple with an intensifying tariff environment in the first month of the second quarter. The magnitude of price change accelerated considerably compared with last month’s increase of 0.12%.

Discount Trends: April brought very slight changes to the incidence and amount of discounts to the durables and personal goods sector, with frequencies rising month-over-month to 21.2% of all durable and personal goods from 20.5% in the month prior, and the typical magnitude decreasing to 19.5% from 20.6%. With price uncertainty remaining high due to ongoing trade negotiations, we should expect overall trends in discounting activity to remain in a holding pattern until more clarity emerges.

Product Group Price Trends: Three product groups – Communications, Home Improvement, and Recreation – all experienced sharp increases in price growth from the prior month, while two groups – Appliances and Personal Care – experienced declines:

• Appliance Group (-0.1%)
• Communication Group (+1.0%)
• Home Improvement Group (+0.5%)
• Personal Care Group (-0.4%)
• Recreation Group (TVs, speakers, and headphones) (+0.7%)

See the full breakdown of product groupings. 

CPI: Appliances

Prices for appliances decreased slightly by 0.06% on a month-over-month basis in March, decelerating from strong growth of 0.47% in the month prior. The discount frequency on appliances increased by nearly three percentage points, from 38.8% in March to 41.5% in April, but the trend has been relatively stable at between 38% and 43% since May 2024. However, the magnitude of such discounts decreased slightly over the month to 16.8% from 17.0% the month prior, and has remained in the low-to-mid teens since the onset of the pandemic.

CPI: Communication

Prices of communication devices, including phones, tablets, computers, and printers, rose sharply on a month-over-month basis to 0.97%, up from a revised 0.05% the month prior. This is the fifth consecutive month where monthly price growth was either flat or positive. Much of the increase in prices was likely due to a drop in both the frequency and magnitude of discounts. The frequency of discounts decreased over the month from 8.0% in March to 5.5% in April, but both months were down by about half since May 2024, when they ranged from about 12.0% to 14.5%. The magnitude of discounts decreased by 400 basis points, from 23.0% in March to 19.0% in April.

CPI: Home Improvement

The index for home improvement goods increased sharply in April to 0.54% on a month-over-month basis, showing 25 consecutive month-over-month flat or monthly increases and up from a flat change in March. Much of the increase in prices was likely due to a drop in both the frequency and magnitude of discounts. The frequency of discounts was 12.0% of products in April, down from 12.4% in March. In addition to the increase in the share of products with a discount, the magnitude of discounts also decreased month-over-month, falling from 18.3% in March to 17.4% in April.

CPI: Personal Care

Prices of personal care products fell on a monthly basis in April 2025 by 0.43%, the second consecutive month of month-over-month declines. Some of this decrease may be due to a slight increase in the incidence and magnitude of price discounts, with the share of discounted personal care products increasing from a revised 23.4% in March to 24.4% in April and the average discount magnitude growing from 20.7% to 21.3% over the same period.

CPI: Recreation

Prices of recreational products, including TVs, headphones, and speaker systems, increased by 0.74% on a month-over-month basis in April, up sharply from 0.20% in March. This is the ninth increase over the past ten months. While the frequency of discounts increased to 22.8% in April from 19.7% in March, the average magnitude of discounts decreased from 23.9% to 23.2% over the same time period.

As of May 2025, the global economy is facing heightened uncertainty amid evolving trade dynamics, stubborn inflationary pressures, and signs of slowing growth in key advanced economies. The United States remains the focal point of macroeconomic discussion, following the full implementation of a sweeping set of tariffs introduced under President Donald Trump’s “Liberation Day” policy, which is already reshaping global trade patterns and domestic price levels.

The U.S. economy is exhibiting mixed signals. On one hand, the labor market remains resilient—April saw a stronger-than-expected addition of 177,000 jobs. On the other hand, early GDP estimates reflect a modest contraction in Q1, driven in part by front-loaded inventory accumulation ahead of tariff hikes. Inflation continues to trend above the Federal Reserve’s 2% target, fueled by rising import prices and supply chain adjustments. Core goods inflation is up, while services inflation remains sticky.

Financial markets have responded cautiously. The S&P 500, after a sharp drop earlier in the year, is stabilizing but remains volatile. Business confidence has dipped, particularly in manufacturing and construction, which are sensitive to input costs and global demand shifts. The Fed is expected to hold interest rates steady through the summer while assessing the full impact of trade measures on inflation and growth.

The European economy is experiencing stagnation, with weak industrial output and declining consumer sentiment. The European Central Bank is expected to begin modest rate cuts in Q2 to prevent deflationary risks. In Asia, China is contending with sluggish growth and persistent weakness in the real estate sector, even as it pursues targeted stimulus and supply-side reforms. Export volumes have declined in response to U.S. tariffs, prompting further realignment in regional trade relationships.

The Trump administration’s tariff regime has become a central risk factor in global forecasts. With universal 10% tariffs on all imports and higher sectoral rates on key partners like China and the EU, retaliation is expected to escalate, potentially fragmenting global supply chains further. While some U.S. industries may benefit from reduced foreign competition, consumers and globally integrated firms are facing rising costs.

Looking ahead, the global economic outlook for the second half of 2025 will depend heavily on policy responses—particularly whether central banks can maintain credibility while navigating between inflation control and supporting growth. The baseline scenario points to slower but positive growth in the U.S. and modest recovery potential in Europe and Asia. However, risks are tilted to the downside, primarily due to geopolitical tensions, trade fragmentation, and tighter financial conditions.

Note: This summary is based on data available as of early May 2025 and may be subject to revisions in future releases. In the May 2025 release, we have adjusted the group weighting when aggregating group-level changes to changes in the overall CPI-DPG, moving from a slight skew from communications and personal goods to an equal weighting scheme. We have back-revised all prior numbers in the release to reflect this change in weighting procedure.

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.

Overall Index Movement:

The OpenBrand CPI of Durable and Personal Goods recorded a 0.2% monthly change in March, notching the fourth consecutive month-over-month increase in prices and the fifth of the last six as retailers continue to grapple with additional tariffs imposed on Canada, China, and Mexico. The magnitude of price change accelerated slightly compared with last month’s increase of 0.1%. This marks a reversal of the deflationary trend observed throughout the second half 2024.

With the implementation of a 10% tariff on goods imported from China in February, followed by an additional 10% on goods imported as of March 4th (bringing the total to 20%), we suspect some of these increases are beginning to affect prices of goods with Chinese origin, especially in the appliances and recreation price groups.

Looking ahead, last week’s (April 2nd) announcement of 10% baseline tariffs across all trading partners and additional reciprocal tariffs on trading partners with the largest tariffs on U.S. exports gives us expectations of further price growth across all groups in next month’s release and throughout the remainder of the first half of 2025. The long-term impact on prices and macroeconomic conditions is less clear, and will depend upon other factors such as Federal Reserve Board interest rate decisions, household and/or business tax cuts, and the outcome of multilateral trade agreements.

Discount Trends: March brought a slight buck to an otherwise falling trend in both the frequency and magnitude of resellers’ discounts, with the frequency rising month-over-month to 24.0% of all durable and personal goods from 23.5% in the month prior, and the typical magnitude increasing to 20.1% from 19.5%. Some of the increase is likely due to Apple’s product announcements in March that forced Apple to lower their price of older models as well as forced competitors to lower prices of their competing products.

What’s more, retailers of home improvement products also increased their discount frequency and magnitude in anticipation of the spring cleaning/home selling season. We show these trends below. Last, we do anticipate discount frequencies and magnitudes to decrease as the impacts of tariffs continue to work into product lines across all groups.

Product Group Trends: All five product groups — Appliances, Communication, Home Improvement, Personal Care, and Recreation — showed positive or neutral month-over-month price growth in March. 

• Appliance Group (+0.4%)
• Communication Group (+0.0%)
• Home Improvement Group (+0.0%)
• Personal Care Group (+0.0%)
• Recreation Group (TVs, speakers, and headphones) (+0.3%)

See the full breakdown of product groupings. 

CPI: Appliances

Prices for appliances grew by 0.4% on a month-over-month basis in March, accelerating from flat growth in the month prior to the largest monthly price growth since December 2022. The discount frequency on appliances decreased by nearly a full percentage point, from 39.8% in February to 39.1% in March, but has been relatively stable at between 38% and 43% since May 2024. However, the magnitude of such discounts increased over the month to 17.1% from 16.2% the month prior, and has remained in the low-to-mid teens since the onset of the pandemic. 

What’s more, we find that specific categories of appliances have seen faster price growth acceleration than others. The three largest swings between February and March have been across laundry equipment and refrigerators, which have each seen a 120 basis point increase in their growth rates (laundry from 0.4% in February to 1.6% in March, refrigerators from -0.2% in February to 1.0% in March).

Other sharp movers include dishwashers and microwave ovens accelerating by 100 basis points (dishwashers from -0.2% to 0.8% and microwaves from 0.6% to 1.6%), cook tops and wall ovens moving 60 basis points (from 0.0% to 0.6%), and kitchen ranges moving 40 basis points (from 0.0% to 0.4%).

CPI: Communication

 Prices of communication devices, including phones, tablets, computers, and printers, were flat on a month-over-month basis. This is the ninth consecutive month where monthly price growth was either flat or positive. The frequency of discounts increased slightly over the month from 7.2% in February to 7.9% in March, but both months were down by about half since May 2024, when they ranged from about 12.0% to 14.5%. The magnitude of discounts increased by 60 basis points, from 22.4% in February to 23.0% in March, being the largest since July 2023. This comes on the heels of new product announcements from Apple last month.

CPI: Home Improvement

The index for home-related durable goods was flat in March on a month-over-month basis, breaking 29 consecutive month-over-month increases and down from last month’s revised increase of 0.2%. The frequency of discounts was 12.4% of products in March, up sharply from 9.4% in February as retailers prepare for what they hope to be a competitive but busy Spring cleaning and home buying season. In addition to the increase in the share of products with a discount, the magnitude of discounts also increased month-over-month, growing from 17.2% in February to 18.2% in March. 

CPI: Personal Care

Prices of personal care products were flat on a monthly basis in March 2025, ending three consecutive monthly price increases and down from a revised 1% in January and 0.2% in February. Some of this decrease may be due to a slight increase in the incidence and magnitude of price discounts, with the share of discounted personal care products increasing from a revised 22.8% in January and 22.9% in February to 23.2% in March and the average discount magnitude growing from 20.4% to 20.8% over the same period.

CPI: Recreation

Prices of recreational products, including TVs, headphones, and speaker systems, increased by 0.3% on a month-over-month basis, matching February’s revised number but down from January’s revised 1.9%. This is the eighth increase over the past nine months. While the frequency of discounts increased to 18.3% in March from 17.5% in February. The average magnitude of discounts increased slightly from 23.9% in January to 24.2% in March.

The global economy faces the possibility of strong turbulence in the wake of the United States’ new implementation of broad, and tactically deep, tariffs. On April 2, President Trump announced a 10% universal tariff on all imported goods, effective April 5, with higher “reciprocal tariffs” targeting specific countries: 34% for China, 20% for the European Union, and 24% for Japan. Additionally, a 25% tariff on foreign automobiles began on April 3. ​

The Trump administration asserts that these measures aim to revitalize U.S. manufacturing, reduce the trade deficit, and lower national debt. However, economists and international partners have expressed concerns about potential disruptions to global trade, increased inflation, and economic slowdowns. The Organisation for Economic Co-operation and Development (OECD) forecasts a deceleration in U.S. economic growth to 2.2% in 2025 and 1.6% in 2026, but questions about the net effect on U.S. consumers remain to be seen. This is because there have been discussions within the Trump administration on explicitly reducing or eliminating federal income taxes and/or providing supplementary tax benefits to offset the potential increase in the cost of consumer goods due to such tariffs. 

Internationally, the tariffs have shown signs of straining relations with key U.S. allies and trading partners. The European Union and Canada have pledged retaliatory measures, potentially further escalating trade tensions with our closest trading partners. These developments have led to recent volatility in global markets and at least short-run declining consumer confidence, with the possibility of retaliatory measures extending beyond the economic sphere.

In summary, the introduction of these tariffs in April 2025 has introduced significant uncertainty into the global economic landscape, with potential implications for growth, inflation, and international trade relations.

Join me for an OpenBrand webinar on Tax Day, April 15, where I will discuss all things inflation and tariffs. You can register for the webinar here.

Note: This summary is based on data available as of early April 2025 and may be subject to revisions in future releases.

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.

Overall Index Movement:

The OpenBrand CPI of Durable and Personal Goods recorded a 0.1% monthly change in February, notching the third consecutive month-over-month increase in prices and the fourth of the last five as retailers grapple with newly imposed tariffs on China and possible tariffs on Canada and Mexico. The magnitude of price change, however, was much smaller than last month’s increase of 0.6%, and follows a six-month deflationary trend in the second half of 2024.

Given the implementation of a 10% tariff on goods imported from China in February and an additional 10% on goods imported as of March 3rd, we anticipate both our monthly and annual CPI growth rates across all groups to reaccelerate in next month’s release and throughout the remainder of the first half of 2025, though the increase in the growth rate will likely be less than initially expected early last week as President Trump delayed yet again the implementation of 25% tariffs on most Canadian and Mexican imports.

Discount Trends: The falling trend in both the frequency and magnitude of reseller’s discounts have at least in part contributed to the recent three-month streak of positive price appreciation. This is likely due to the initial 10% tariff applied to China in February, and given the additional 10% applied on March 3rd, we should expect a decreasing trend in the frequency and magnitude of discounts in next month’s release. Between these two months, the share of products with discounts decreased by 130 basis points, from 22.6% of products in January to 21.3% in February. This is the third consecutive month of month-over-month decreases that began in November when 27.0% of product offerings came with a discount. Over the same period, the typical discount size has remained relatively stable at between 17.8% and 18.6%.

Annual Trends: Year-over-year, durable and personal goods prices were essentially flat, showing a small decrease of 0.1%. This is the tenth consecutive month of negative year-over-year price growth that reflects a lower rate environment compared to the same time last year. However, it is the smallest decline during this stretch, where annual declines of 0.7%to 0.9% have been the norm. This is down from a revised annual decline of 0.3% in January.

Product Group Trends: All five product groups — Appliances, Communication, Home Improvement, Personal Care, and Recreation — showed positive month-over-month price growth in February.

• Appliance Group (+0.0%)
• Communication Group (+0.0%)
• Home Improvement Group (+0.6%)
• Personal Care Group (+0.3%)
• Recreation Group (TVs, speakers, and headphones) (+0.2%)

See the full breakdown of product groupings. 

CPI: Appliances

Prices for appliances were on a month-over-month basis in February. This ends a two-consecutive month gain of nearly 1%. The discount frequency on appliances decreased slightly from 42.2% in January to 39.9% in February, but has been relatively stable at between 38% and 43% since May 2024. The magnitude of such discounts remained unchanged over the month at 16.2%, and has remained in the low-to-mid teens since the onset of the pandemic.

CPI: Communication

Prices of communication devices, including phones, tablets, computers, and printers, were also flat on a month-over-month basis. This is the ninth consecutive month where monthly price growth was either flat or positive. The frequency of discounts increased slightly over the month from 6.6% in January to 7.1% in February, but both months were down by about half since May 2024, when they ranged from about 12.0% to 14.5%. The magnitude of discounts ticked down just a hair, from 22.4% in January to 22.3% in February, though both months are discount highs not seen since April 2024.

CPI: Home Improvement

The index for home-related durable goods moved up 0.6% on a month-over-month basis, the 29th consecutive month-over-month increase and down just slightly from last month’s revised increase of 0.8%. The frequency of discounts was 8.2% of products in February, down from 11.0% in January. In addition to the drop in the share of products with a discount, the magnitude of discounts also declined month-over-month, falling from 18.4% in January to 17.1% in February.  

CPI: Personal Care

Prices of personal care products moved up by 0.3% on a monthly basis in February 2025, the third consecutive monthly increase and up from a revised 1.4% in January and 0.7% in December. Some of this increase may be due to a monthly decrease in the incidence and magnitude of price discounts, with the share of discounted personal care products falling from a revised 26.8% in December and 23.9% in January to 22.9% in February and the average discount magnitude falling from 23.1% to 20.6% over the same period.

CPI: Recreation

 Prices of recreational products, including TVs, headphones, and speaker systems, moved by 0.2% on a month-over-month basis, down from January’s revised and relatively large increase of 1.8%. This is the seventh increase over the past eight months. While the frequency of discounts increased to 17.9% in February from 16.7% in January, both of these months show the lowest rate of product discounts since just after the pandemic started in early 2020. The average magnitude of discounts also dropped to lowest level since 2020, falling from 24.4% in January to 23.3% in February. 

As of March 2025, the global economic landscape presents a complex interplay of legacy resilience and emerging challenges. In the United States, the economy has shown unexpected strength over the past several months, with robust consumer spending and a tight labor market helping contribute to growth. However, recent data indicating weaker-than-expected figures in consumption, a stagnant housing market, and an emerging trade war are raising concerns about potential risks to sustained economic expansion in the U.S. and abroad. 

Impact of Tariffs on CPI

Global trade dynamics are undergoing significant shifts, particularly with the implementation of new U.S. tariffs. Last, the United States has threatened to implement tariffs of 25% on goods from Canada and Mexico and implemented an additional 10% on imports from China on March 4. These measures are expected to put upward pressure on inflation and add layers of complexity to international economic relations and domestic consumer sentiment, with additional implications for expected economic growth throughout the rest of the year.

How will these tariffs affect prices of consumer durable and personal goods? The simple answer is that it depends. For products imported from these countries with small margins, the impact to pricing is likely to be close to the full value of the tariff as retailers have little room to absorb it into their already small margins. For products with large margins, retailers have the liberty to choose how much of the cost of the tariff should be passed on to consumers. If the expected tenure of the tariffs is short, sellers of such high margin products may choose to simply absorb the entire cost of the tariff and wait until the tariff passes. On the other hand, resellers with smaller margins won’t have this luxury and may be forced to raise prices soon. 

The Federal Reserve, acknowledging these mixed signals, maintains a “moderately restrictive” monetary policy stance, keeping the federal funds rate in the range of 4.25% to 4.50%. This approach aims to balance the need to support growth while ensuring inflation continues its downward trajectory toward the 2% inflation target. After the tariff announcements last week and equity market turmoil that ensued, markets are now pricing three 25 basis point rate cuts by the end of the year. 

In Europe, the economic outlook is more subdued. The European Central Bank (ECB) is anticipated to cut interest rates in its upcoming meeting. However, there are concerns that further easing could inadvertently lead to economic stimulus before inflation is fully controlled. This uncertainty is exacerbated by unpredictable geopolitical events, including potential U.S. tariffs and a complex and evolving situation in Ukraine. 

Financial markets reflect a cautious sentiment amid these developments. Investor anxiety is evident, with the Cboe’s Volatility Index (VIX) rising by nearly 33% from the middle to the end of February. As of this week, both the S&P 500 and the Nasdaq Composite indices are down year-to-date.

Overall, the global economy in March 2025 is navigating a path marked by resilience in certain sectors and regions, counterbalanced by emerging risks and uncertainties. Policymakers and investors alike are urged to remain vigilant, adapting strategies to the evolving economic landscape as legacy influences give way to more contemporary drivers.

Note: This summary is based on data available as of early March 2025 and may be subject to revisions in future releases.

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.

Overall Index Movement: The OpenBrand CPI of Durable and Personal Goods recorded a 0.6% change in January, reflecting inflationary pressures in the market in anticipation of President Trump’s promise of tariffs on Canada, China, and Mexico. Although tariffs on Canada and Mexico have been postponed until early March, this is the second consecutive month of price increases and third of the past four months following a six-month deflationary trend in the second half of 2024.

Annual Trends: Year-over-year, durable and personal goods prices have decreased by 1.4%, indicating a broader downward trend in prices that reflects a lower rate environment compared to the same time last year. For perspective, the effective federal funds rate (EFFR) at the end of January 2025 was a full 100 basis points lower than the same period last year, suggesting that both consumers and wholesalers using debt to purchase goods have benefited from a lower rate environment.

Product Group Trends: All five product groups — Appliances, Communication, Home Improvement, Personal Care, and Recreation — showed positive month-over-month price growth in January. 

• Recreation Group – which includes TVs, speakers, and headphones (+2.8%)
• Personal Care products (+1.1%)
• Home Improvement (0.6%)
• Appliances and Communication products (+0.4%).

See the full breakdown of product groupings. 

Macroeconomic Summary: The broader U.S. economy remains healthy, with labor markets staying relatively tight at an unemployment rate of 4.1% and consumer spending up 0.7% in December. While the recent threats of tariff implementations pose potential inflationary risks to the economy, currency markets have priced most, if not all, of the expected increase in wholesale prices due to such tariffs over the past four months. It’s also important to note tariffs are typically applied to wholesale — not retail — prices. In both cases, we should expect the potential impacts of such tariffs on retail pricing, if or when they are implemented, will likely be less than the face value of the tariffs themselves. 

CPI: Appliances

Prices for appliances increased by 0.4% on a month-over-month basis in January, representing the second consecutive month of month-over-month gains with a cumulative price growth of nearly 1%. Though the magnitude of discounts on appliances has remained relatively stable over the past year at around 18%, the frequency of discounts has fallen slightly over the past month from 43.2% in December to 42.6%.

CPI: Communication

Prices of communication devices, including phones, tablets, computers, and printers, increased by 0.4% on a month-over-month basis. This is the fifth consecutive monthly increase, reflecting a counter-trend in the communications sector of inflationary pressures not seen in other consumer segments. 

While the magnitude of discounts has increased slightly over the past few months – from 15.8% in May of last year to 18.6% in January 2025 – it was not enough to counter the sharp reduction in the frequency of discounts, with the share of retailers offering price discounts falling from 15% in August of last year to just 9.6% last month. 

CPI: Home Improvement

The index for home-related durable goods moved up 0.6% on a month-over-month basis, the 27th consecutive month-over-month increase. While pricing growth has been persistently positive over the past two years, the sector continues to see a discount incidence in the double digits with 10.8% of products discounted in the month of January. Though this is down from 12.9% in December and 11% in November, the magnitude of discounts has remained steady at about 18%.

CPI: Personal Care

Prices of personal care products moved up by 1.3% on a monthly basis in January 2025, the second consecutive monthly increase and up from 1.1% in December. Much of this increase is due to a monthly decrease in the incidence and magnitude of price discounts, with the share of personal care products with discounts falling from 29% in December to 23.4% in January, with the average discount magnitude falling from 22.7% to 21.4% over the same period.

CPI: Recreation

Prices of recreational products, including TVs, headphones, and speaker systems, moved up sharply by 2.8% on a month-over-month basis after a cumulative decline of nearly 1% in November (-0.2%) and December (-0.7%) 2024. Much of this increase is due to a monthly decrease in the incidence and magnitude of price discounts, with the share of recreation products with discounts falling from 23.2% in December to 17.7% in January, with the average discount magnitude falling from 26.7% to 24.6% over the same period.

As of February 2025, the U.S. economy exhibits a blend of robust growth and emerging challenges. On the upside, the U.S. economy continues to demonstrate resilience, with Gross Domestic Product (GDP) growth projected to grow by 2.5% in 2025, driven primarily by strong consumer spending and productivity gains. While the labor market remains tight, the service sector experienced a slight slowdown in January but remains at robust levels to support consumer spending throughout the first half of 2025.

Impact of Tariffs on CPI

The recent threats of 25% tariff implementations on Mexico and Canada, and the actual 10% tariff implementation of China, pose potential inflationary risks to the economy. However, it’s important to note two facts when anticipating the impacts of such tariffs on pricing. 

First, free currency markets — notably currency exchanges for Canadian Dollars and Mexican Pesos — have trended downward in recent months, likely reflecting a market expectation that President Trump would implement tariffs on imports from both countries. For example, between September 2024 — when prediction markets began favoring a Trump victory in the U.S. election — and December 21 — a month before President-Elect Trump would take office — currency markets devalued the Canadian Dollar by 24.8%. Over a similar time period, the Mexican Peso fell by 11.3%. This means that nearly the entire 25% tariff on Canadian goods and nearly half of the Mexican tariff had been priced in by currency markets.

Second, it’s also important to consider that tariffs on most consumer goods entering the U.S. are predominantly on wholesale goods. This means that even without currency market adjustments, we shouldn’t expect the amount of such proposed tariffs would be passed on to the consumer. While it’s tough to know what the markups on Canadian and Mexican imported goods are to the consumer, let’s proceed with two scenarios whereby markups are either 50% or 100%. Let’s suppose importers purchase $100 worth of goods from Canada and/or Mexico and pay the 25% tariff – which equals $25. This means the total cost of the goods for the importer is $125 in each scenario. If they pass the entire tariff amount onto the consumer, this means the imported goods will cost the consumer $175 ($100 wholesale + $50 markup + $25 tariff) in the case of a 50% markup and $225 ($100 wholesale + $100 markup + $25 tariff) in the case of a 100% markup. In these cases, the actual price increase to the consumer would be 16.7% in the scenario where markups are 50%, and 12.5% in the case of 100% markup. 

When the first and second scenarios are combined, it seems reasonable to expect that the actual price increase to the consumer would be significantly less than the face value of the tariff. While we will be monitoring our pricing data intimately over the coming months to spot any observed price impacts of such tariffs, it’s possible the impact is small enough so as to be imperceptible in OpenBrand’s (and others’) pricing data.

While the U.S. economy is poised for continued growth in 2025, policymakers and business leaders remain vigilant regarding potential headwinds, including trade tensions and inflationary pressures. Ongoing monitoring of these factors will be crucial to sound economic positioning of retail businesses, policymakers, and the broader investment community. 

Note: This summary is based on data available as of early February 2025 and may be subject to revisions in future releases.

The OpenBrand CPI of Durable and Personal Goods is constructed using a data-driven methodology that ensures accuracy, timeliness, and transparency in measuring price trends for both short and long-lasting consumer products. The methodology consists of the following key components:

1. Data Collection

• Real-Time Price Tracking: Prices are sourced daily from online marketplaces, retail websites, and brick-and-mortar store listings.
• Retailer & Manufacturer Data: Aggregates pricing information from major retailers, direct-to-consumer brands, and wholesale suppliers into broader consumer categories.
• Temporal Coverage: Captures price variations over time, including daily discounts and price promotions

2. Product Selection & Tracking

• Durable and Personal Goods Focus: The index includes products with an expected lifespan of three years or more, such as home appliances, consumer electronics, and tools, as well as personal care products with a shorter lifespan, such as hair and skin care products, vitamins, over-the-counter medications, and oral care products. 
• Brand & Model Tracking: Individual brands and models are monitored to reflect pricing shifts within competitive product segments, including both permanent changes in listing price as well as temporary promotional pricing.

3. Price Calculation, Adjustments, and Weighting

• Price Calculation: Tracks month-over-month and year-over-year price movements to measure price stability in the marketplace and take into account both longer-term changes in pricing (such as changes in manufacturer’s suggested retail price) as well as more short-term changes in pricing, such as promotional discounts and sales prices. 
• SKU-Removal Instead of Hedonic Adjustments: When a product (or SKU) becomes unavailable in the BLS goods basket, the BLS implements a SKU-replacement procedure whereby the next most similar product is used in its place, and a quality (hedonic) adjustment procedure is performed to get closer to an apples-to-apples price comparison. Since OpenBrand has data on nearly 100% of the SKUs pricing history in a given product category, we can simply remove that SKU from the basket and rely on price changes of the remaining SKUs in that basket. This eliminates the need for hedonic adjustment in the OpenBrand CPI basket.
• Weighting and Aggregation Method: A weighted geometric mean formula is used to minimize volatility and improve stability in price trend analysis at both the product grouping and category level. Instead of using sales-volume weights when aggregating the index, we take an alternative approach by using persistence-based weights for aggregation. Instead of more frequently purchased items getting more weight in the BLS’ CPI calculation, OpenBrand takes a more novel approach by weighting items with a more established price history in the market more heavily in our CPI calculation than items with a less established history.

4. Reporting & Updates

• High-Frequency Updates: Published freely on a monthly basis, with a subscription option for daily summaries across categories, sub-categories, and individual products.
• Comparative Benchmarks: We aggregate pricing as analogously as possible to traditional BLS CPI measures for benchmarking purposes.
• Transparency & Accessibility: Provides both open and paid data access for journalists, researchers, businesses, and policymakers.

By leveraging real-time data and advanced statistical techniques, the OpenBrand CPI offers an accurate and dynamic measure of pricing trends, helping businesses and consumers make informed decisions in an evolving economic landscape.