During the first set of tariffs in 2018 the Fed staff ran an analysis of the possible impact of a 15% universal tariff in their Teal book at the end of that year.

They considered two scenarios, one in which the Fed looked through the inflation spike and another in which they responded with higher rates.

Their forecasts concluded that core PCE would be boosted by just over a percentage point in the first year of the forecast but would quickly fade in the following year. They also argued that if the Fed responded, it would tip the economy into recession.

2025 could, of course, be different but the analysis is nevertheless an interesting place to start.