Amazon CEO says that tariffs are starting to 'creep' into prices as vendors run out of stockpiled goods

Core Insights - Amazon's CEO, Andy Jassy, indicated that tariff price hikes are beginning to affect consumer prices as vendors deplete their stockpiled goods imported before the tariffs were implemented [1] - Jassy noted that some sellers are passing on the increased costs to consumers, while others are absorbing them to maintain demand, leading to a mixed impact on pricing [1] - The retail sector operates on mid-single digit margins, making it challenging to absorb significant cost increases, such as a 10% rise in costs [2] Pricing Dynamics - Amazon primarily functions as an e-commerce platform for independent sellers, limiting its control over price increases [7] - There was a previous rumor that Amazon would disclose the tariff impact on item prices, which drew criticism from the Trump administration; however, Amazon clarified that it had no such plans [7] Tariff Context - The majority of tariffs were enacted under presidential emergency powers, including a 10% baseline levy on nearly all imports, with ongoing legal scrutiny from the US Supreme Court regarding their constitutionality [8] - If the Supreme Court rules the tariffs unconstitutional, the government may face potential refunds amounting to $1 trillion to businesses that paid these tariffs [9] - According to the Kiel Institute for the World Economy, 96% of the new revenue from US Customs is being borne by American consumers, while only 4% is shouldered by foreign exporters [10]