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US importers switching suppliers to avoid tariffs

In response to the tariffs imposed on China, US importers are switching to alternative suppliers in Asia, which could explain why custom duties revenues have fallen back in the past couple of months. This would represent a “deadweight” loss of real income for US consumers if the price of goods from those other countries was significantly higher than the pre-tariff price of Chinese goods. Thankfully, the impact on final consumer prices still appears limited, perhaps because the substitution partly reflects Chinese producers rerouting their goods through these third countries to avoid duties.

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