Economic Watch: Experts cautious about U.S. 2026 growth forecast amid tariff concerns

by Julia Pierrepont III

LOS ANGELES, Feb. 8 (Xinhua) -- The economic growth forecast for the United States in 2026 remains relatively optimistic, with projections ranging between 2 and 2.8 percent. However, logistics experts cautioned that actual shipment volumes are weak while supply chain costs continue to rise.

"A mirage," Alan Murphy, CEO and founder of Sea-Intelligence, a global shipping analysis firm, told CNBC on Friday. He noted that although economic growth indicators have risen and employment in logistics and retail appears strong, these metrics were largely driven by advance buying -- a one-time event rather than a sustainable trend.

Despite the IMF's latest outlook projecting global growth at 3.3 percent for 2026 and 3.2 percent for 2027, an analysis by Sea-Intelligence published Thursday noted, "This decrease appears to be a direct consequence of the 'front-loading' phenomenon seen throughout 2025, where shippers accelerated imports to pre-empt anticipated trade policy shifts."

In early 2025, the Trump administration implemented a wave of tariffs on imported goods, targeting products from key foreign trade partners. The stated aim was to protect American industries and encourage domestic production.

Following the tariff announcements, the United States witnessed a surge in economic activity touted by Washington as evidence of a thriving economy under Trump's trade policies.

However, many economists and trade analysts argued that the surge was largely the result of major retail chains -- ranging from Walmart to Target -- scrambling to stock up on inventory before the tariffs took full effect.

This preemptive buying spree temporarily boosted import figures and created the impression of economic vitality. Yet the momentum proved unsustainable once the tariffs were implemented, ultimately dampening both retailer purchases and consumer demand.

The phenomenon of advance buying is well known in international trade. When tariffs are announced, businesses routinely rush to import goods at lower, pre-tariff rates.

In 2025, this behavior reached unprecedented levels among America's largest retailers. By importing more goods ahead of the tariffs, these companies generated a spike in economic activity that, in official statistics, seemingly reflected growth in the retail and import sectors.

But the surge in imports did not reflect increased consumer demand or long-term economic health. Instead, it represented a temporary, panicked response to impending policy changes.

Murphy said the economy will not provide the booming consumer demand required to absorb the higher costs pushed by tariffs and unstable trade policies.

Treasury Secretary Scott Bessent recently denied that the tariffs are inflationary, a stance many experts found unconvincing.

"The fact that transportation and inventory prices are higher but warehouse prices didn't really move indicates to me that probably we are seeing inflation that has not yet been picked up at the consumer tier of the supply chain," Dale Rogers, a professor in the supply chain management department at Arizona State University, told CNBC.

"This poses an interesting question: are the higher transportation prices and inventory costs happening because the economy is getting better, or is it inflation due to the tariffs?" Rogers said. "Sometimes, inflation signifies an improving economy, but these increases have to be at least partially about the tariffs."

Leading financial analysis firm Morningstar forecasts inflation will rise to 2.7 percent in 2026, up from earlier expectations, as businesses pass on tariff-related costs to consumers.

Researchers at the Peterson Institute for International Economics last month predicted that inflation could exceed 4 percent by late 2026 due to the lagged and compounding effects of Trump's tariff-driven trade policy. The current optimism that inflation would continue its gradual descent toward the Fed's 2 percent target is "premature," they warned.

The temporary nature of the growth spurt would become apparent once advance buying ran its course.

Lazard Orszag, former Obama administration budget director, said that "most of the pass-through from the tariffs has not actually occurred yet," explaining that companies had previously relied on measures such as advance inventory purchases to buffer against duties, but those strategies have largely run out.

In an interview with CNBC, he estimated the tariff effect could add "another 50 or 70 basis points on inflation" in the United States, driving up costs for everyday products.

"We're already seeing price increases across the board," Chris M, a cashier in a grocery chain store in Los Angeles, told Xinhua Saturday. "Customers are complaining, but with these tariffs driving up our wholesale costs, there is nothing we can do unless Trump repeals his tariffs."

Diane Swonk, KPMG's chief economist, also predicted the "stagflationary" nature of large tariffs, noting they are "just unable to be completely absorbed by either firms or completely passed on to consumers."

"Tariffs are simply inflationary, despite what (President) Donald Trump may tell people," Bradley Saunders, a North America economist at Capital Economics, has said. ■