Table of Contents

• Costco

• U.S. Inflation

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Costco

Costco reported quarterly revenue and profit that exceeded Wall Street expectations, driven by an 8% increase in comparable sales and a nearly 16% rise in e-commerce, though shares dipped slightly. Company leaders highlighted that recent tariffs have increased costs, prompting adjustments to supply chains and selective price changes. Some items, like eggs and olive oil, saw price cuts, while others, such as imported flowers, saw increases. Roughly one-third of Costco’s U.S. sales involve imports, with about 8% sourced from China. The company expects tariff-driven consumer caution may ultimately attract more shoppers seeking value and membership renewals.

U.S. Inflation

U.S. inflation remained subdued in April, with the personal consumption expenditures (PCE) price index rising just 0.1%, keeping the annual rate at 2.1%, its lowest this year. Core inflation, which excludes food and energy, also increased 0.1%, slightly below expectations. Consumer spending slowed to 0.2%, while personal income grew 0.8%. Recently imposed tariffs by President Trump have yet to influence consumer prices, though economists expect potential increases in coming months if trade policies persist. Meanwhile, Trump has urged the Fed to cut rates, but officials remain cautious amid uncertainty over tariffs and their future economic impact.

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