The insight: Nearly two-thirds of US consumers (63%) believe businesses are taking advantage of the challenging economic climate to raise prices, according to a survey by The Harris Poll.

Those concerns are echoed by lawmakers: Senator Elizabeth Warren recently introduced a bill targeting potential price gouging as a result of tariffs or other “abrupt trade policies,” arguing that they “are giving companies cover … to raise prices more than necessary.”

The landscape: Companies face intense pressure to offset tariffs without turning off shoppers. For the vast majority of retailers—including heavyweights like Walmart—the cost of tariffs is too high to swallow without raising prices on at least some products. Eighty-three percent of companies plan to raise their prices in the next six months, per a KPMG survey, while nearly three-quarters have already passed on some of those costs.

While consumers expect tariffs to push prices higher, how companies communicate those increases can help minimize frustration and churn.

• 68% of brand and retail executives anticipate negative reactions from consumers to price increases, according to a survey from First Insight.
• But being upfront about those hikes could help ease shoppers’ angst, especially if companies are transparent about the cause.
• Brands that can afford it should consider keeping prices level for some products—and communicating that prominently to customers. Shoppers are more inclined to stay loyal to companies that absorb tariff-related costs.
• 79% of US consumers say they would be more likely to stick with brands that shield them from increases, per First Insight.

However, tariff pricing transparency can be a fraught issue for retailers—especially in the wake of Amazon’s dressing-down from the Trump administration following news that it considered breaking out tariff costs for its Haul marketplace. Though smaller brands and retailers are more likely to be spared presidential scrutiny, the possibility of being on the receiving end of a pointed Truth Social post could scuttle any attempts by larger companies to be open about their pricing calculus.

Our take: The era of historically high tariffs is complicating pricing strategies. Companies that choose to pass on most of their costs risk losing customers to competitors—not to mention potentially angering the US government. On the other hand, few brands and retailers can afford to absorb all tariff expenses, making increases on some products likely.

Most consumers expect prices to go up, but they shouldn’t be surprised by tariff surcharges at checkout. Businesses should avoid the urge to use tariffs as a way to pad their margins and instead should aim to keep prices on popular items as steady as possible while clearly explaining unavoidable increases.