With as fast as the market seems to change right now, a weekly check actually allows a bit of perspective.
In March, US consumer prices eased more than expected, with the twelve-month inflation rate dropping to two point four percent, below the predicted two point six percent. The core inflation rate, which excludes food and energy, rose by two point eight percent, marking its lowest increase in four years. As one analyst noted, the March Consumer Price Index is being viewed as a non-event in light of the effects of the tariffs.
Because, so far for April, consumer sentiment plummeted by eleven percent, according to a survey conducted by the University of Michigan, which involved about four hundred consumers. This decline occurred alongside a surge in inflation expectations, which rose to six point seven percent, the highest level since 1981. The survey indicated that both Republican and Democratic consumers reported deteriorating expectations regarding business conditions, personal finances, and inflation. The significant drop in sentiment has been attributed to the economic consequences of President Trump’s tariff policies, which have dampened optimism.
On Friday, the Trump administration exempted smartphones, computers, and other electronics from the new tariffs imposed on Chinese goods. This decision, reported by Bloomberg, means that products like laptops, hard drives, and memory chips will no longer be subject to the 125 percent additional tariff, although some pre-existing tariffs will still apply. Additionally, US Customs and Border Protection has clarified that these exemptions extend to changes in small-parcel shipping duties. This news follows Trump’s recent announcement of a ninety-day pause on tariff increases for most countries while raising the total rate for Chinese imports to 145 percent.
The Register reports that the Trump administration’s trade tariffs are causing significant uncertainty in the IT industry, with many chief information officers pausing new projects due to concerns over budget disruptions. A recent report by investment bank Jefferies highlights that despite some temporary exemptions on electronics, tariffs remain higher than earlier this year. The report warns that the pause in tariffs does not eliminate business uncertainty, creating earnings risks across the sector. Major technology companies like HP and Apple may have suspended shipments from China due to these tariffs. Analysts point out that the reliance on China’s manufacturing poses challenges, as many companies may have to defer new business decisions, impacting the industry’s growth trajectory.
Why do we care?
When CIOs pause large IT projects, that slowdown trickles down to midmarket IT and SMBs. If enterprise demand pulls back, VARs and MSPs often feel it second-hand via delayed refresh cycles, deferred cloud migrations, or frozen budgets.
Regardless of CPI numbers, inflation expectations rising to 6.7% will impact purchasing behavior. Clients may start deferring spend out of fear, even if actual prices stay flat short-term.
The unpredictable application of tariffs—impose, exempt, pause, then raise again—undermines confidence. This matters because MSPs often base contracts on multi-year timelines. You can’t price in policy chaos without becoming uncompetitive.
As uncertainty rises, clients need help making decisions more than executing them. Double down on your vCIO and strategic guidance offerings. Those that navigate well will gain trust and long-term loyalty.
And Watch SMB Buyer Behavior Closely: Even if you’re not directly affected today, you’re one procurement freeze away from a budgetary cascade. Use QBRs and monthly check-ins to sense shifting sentiment early. Because speaking of….