Retailers are navigating a fresh wave of pricing shifts as August inflation and new tariffs push up costs in categories like autoparts, furniture, and home improvement, signaling tighter conditions ahead for companies from Walmart Inc. (NYSE:WMT) to Best Buy Co. Inc. (NYSE:BBY).
JP Morgan analyst Christopher Horvers provided fresh insights into pricing trends across the broadlines and hardlines retail sector, highlighting the impact of August inflation on key categories.
The latest data underscores how tariffs and shifting consumer dynamics are influencing retail price movements in real time.
Also Read: Goldman Sachs Says August CPI Inflation Is Heating Up: Tariffs, Travel, Used Cars Behind The Surge
Headline consumer prices increased 2.9% year over year in August, while core inflation stood at 3.1%. Both figures were slightly above July's levels but aligned with expectations from the bank's economists.
Horvers observed that most hardlines categories saw continued price firming last month as merchants brought in tariff-affected inventory.
Price gains were most notable in autoparts, furniture and bedding, and home improvement, while televisions showed reduced deflation.
Apparel also shifted into positive territory, flipping from prior weakness. In contrast, appliances, toys, and computers experienced softening prices, with some categories moving into outright deflation.
On a monthly basis, pricing momentum strengthened in nine of the fifteen tracked categories.
TVs recorded a smaller decline, autoparts rose 2.1% versus 0.4% the prior month, and furniture/bedding climbed 4.7%. Home improvement products advanced to nearly 4% growth.
By contrast, appliances slipped further into negative pricing, toys slowed considerably, and computers declined more sharply than in July.
Horvers writes, grocery inflation also picked up modestly, with food-at-home rising about 2.7% annually, up from July. Pet food prices ticked slightly higher as well.
Analysts noted that tougher year-over-year comparisons are likely for home-related categories like furniture and improvement, while easier comparisons should provide relief for sectors such as autoparts, appliances, and computers in the months ahead.
Rising costs, compounded by tariffs, continue to shape consumer choices and retailers' pricing power. Investors tracking companies like Walmart Inc. and Best Buy Co. Inc. may see impacts across multiple categories.
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