The Boston Fed has published a paper by Philippe Andrade, Omar Barbiero and Alvaro Silva titled How Much Did Labor Productivity Gains Offset the Inflationary Impact of the 2025 Tariffs?:
In 2025, the average realized tariff on U.S. imports rose from about 2.5 percent to about 10 percent. The resulting increase in U.S. firms’ input costs had the potential to raise inflation significantly and explain why inflation remained significantly above the Federal Reserve’s 2 percent target last year.
On the other hand, as the tariffs took hold, U.S. workers’ productivity grew, which could have helped companies reduce their costs and thereby mitigate inflationary pressures from the tariffs. To study the extent to which productivity gains may have offset the tariff-driven cost increases, the authors construct measures of sectoral increases in input costs induced by the new tariffs and compare them with sectoral labor productivity gains.
Key Takeaways:
- In 2025, the sectors that were more affected by tariffs relative to other sectors experienced significantly greater labor productivity growth, mitigating the cost increases induced by the new trade policy.
- The sectors that were more exposed to tariffs also experienced a decline in the labor share—the proportion of a sector’s value-added that’s allocated to worker compensation—implying relatively higher profits and return to capital in these sectors.
- Mapping production costs to aggregate core inflation indicates that on net, tariffs and labor productivity gains contributed an estimated 0.5 percentage point to core PCE inflation in 2025. Wage growth added another 1.9 percentage points.
- If these cost components’ combined contribution to inflation was only 2.4 percentage points, then tariffs alone may not explain the persistence of 3 percent core PCE inflation last year.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
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| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1627 % | 2,665.6 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.1627 % | 5,019.8 |
| Floater | 5.42 % | 5.62 % | 30,738 | 14.44 | 3 | 0.1627 % | 2,892.9 |
| OpRet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.6620 % | 3,629.9 |
| SplitShare | 4.80 % | 4.24 % | 60,170 | 2.60 | 5 | -0.6620 % | 4,334.8 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.6620 % | 3,382.2 |
| Perpetual-Premium | 5.65 % | 5.54 % | 54,731 | 6.76 | 12 | -0.2744 % | 3,073.1 |
| Perpetual-Discount | 5.54 % | 5.61 % | 39,418 | 14.46 | 21 | 0.0190 % | 3,404.4 |
| FixedReset Disc | 5.56 % | 5.89 % | 92,551 | 13.98 | 17 | -0.7690 % | 3,379.4 |
| Insurance Straight | 5.38 % | 5.46 % | 43,354 | 14.56 | 20 | -0.2465 % | 3,346.0 |
| FloatingReset | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.7690 % | 4,126.3 |
| FixedReset Prem | 5.92 % | 4.71 % | 80,525 | 2.11 | 31 | -0.0487 % | 2,659.6 |
| FixedReset Bank Non | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.7690 % | 3,454.4 |
| FixedReset Ins Non | 5.22 % | 5.30 % | 51,321 | 13.88 | 14 | -0.9093 % | 3,273.5 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| FTS.PR.K | FixedReset Disc | -9.76 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.00 Evaluated at bid price : 22.27 Bid-YTW : 6.03 % |
| PWF.PR.S | Perpetual-Discount | -2.96 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 21.01 Evaluated at bid price : 21.01 Bid-YTW : 5.77 % |
| MFC.PR.Q | FixedReset Ins Non | -2.70 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.72 Evaluated at bid price : 25.25 Bid-YTW : 5.82 % |
| BN.PR.T | FixedReset Disc | -2.28 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.90 Evaluated at bid price : 23.60 Bid-YTW : 5.89 % |
| ENB.PR.H | FixedReset Disc | -2.06 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.92 Evaluated at bid price : 23.25 Bid-YTW : 5.92 % |
| MFC.PR.N | FixedReset Ins Non | -2.02 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.19 Evaluated at bid price : 24.71 Bid-YTW : 5.57 % |
| MFC.PR.K | FixedReset Ins Non | -2.02 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.80 Evaluated at bid price : 25.70 Bid-YTW : 5.47 % |
| BIP.PR.E | FixedReset Prem | -1.75 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2028-03-31 Maturity Price : 25.00 Evaluated at bid price : 25.84 Bid-YTW : 5.09 % |
| BIP.PR.F | FixedReset Prem | -1.69 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2029-01-01 Maturity Price : 25.00 Evaluated at bid price : 25.66 Bid-YTW : 5.68 % |
| MFC.PR.L | FixedReset Ins Non | -1.67 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.49 Evaluated at bid price : 25.25 Bid-YTW : 5.45 % |
| MFC.PR.C | Insurance Straight | -1.49 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 21.51 Evaluated at bid price : 21.77 Bid-YTW : 5.24 % |
| GWO.PR.G | Insurance Straight | -1.45 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.53 Evaluated at bid price : 23.80 Bid-YTW : 5.54 % |
| MFC.PR.B | Insurance Straight | -1.31 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.33 Evaluated at bid price : 22.60 Bid-YTW : 5.22 % |
| MFC.PR.J | FixedReset Ins Non | -1.23 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2028-03-19 Maturity Price : 25.00 Evaluated at bid price : 25.60 Bid-YTW : 5.30 % |
| POW.PR.G | Perpetual-Premium | -1.16 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 24.47 Evaluated at bid price : 24.71 Bid-YTW : 5.73 % |
| FTS.PR.F | Perpetual-Discount | -1.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.71 Evaluated at bid price : 23.00 Bid-YTW : 5.33 % |
| BN.PF.C | Perpetual-Discount | 1.11 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 21.59 Evaluated at bid price : 21.85 Bid-YTW : 5.63 % |
| ENB.PF.G | FixedReset Disc | 1.24 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 23.04 Evaluated at bid price : 24.45 Bid-YTW : 5.97 % |
| SLF.PR.D | Insurance Straight | 1.53 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 21.70 Evaluated at bid price : 21.95 Bid-YTW : 5.13 % |
| BN.PF.E | FixedReset Disc | 1.63 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2030-04-01 Maturity Price : 25.00 Evaluated at bid price : 25.00 Bid-YTW : 5.44 % |
| BN.PF.G | FixedReset Prem | 1.91 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2030-07-01 Maturity Price : 25.00 Evaluated at bid price : 25.56 Bid-YTW : 5.27 % |
| PWF.PR.K | Perpetual-Discount | 3.24 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.07 Evaluated at bid price : 22.30 Bid-YTW : 5.60 % |
| BN.PR.M | Perpetual-Discount | 3.24 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 21.34 Evaluated at bid price : 21.34 Bid-YTW : 5.66 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| IFC.PR.C | FixedReset Ins Non | 82,887 | YTW SCENARIO Maturity Type : Call Maturity Date : 2026-09-30 Maturity Price : 25.00 Evaluated at bid price : 25.13 Bid-YTW : 3.15 % |
| FTS.PR.M | FixedReset Prem | 43,050 | YTW SCENARIO Maturity Type : Call Maturity Date : 2029-12-01 Maturity Price : 25.00 Evaluated at bid price : 25.24 Bid-YTW : 5.15 % |
| FFH.PR.K | FixedReset Prem | 42,500 | YTW SCENARIO Maturity Type : Call Maturity Date : 2027-03-31 Maturity Price : 25.00 Evaluated at bid price : 25.30 Bid-YTW : 4.26 % |
| ENB.PF.A | FixedReset Disc | 31,300 | YTW SCENARIO Maturity Type : Call Maturity Date : 2029-12-01 Maturity Price : 25.00 Evaluated at bid price : 24.86 Bid-YTW : 5.85 % |
| PVS.PR.J | SplitShare | 11,290 | YTW SCENARIO Maturity Type : Call Maturity Date : 2027-02-28 Maturity Price : 25.00 Evaluated at bid price : 25.05 Bid-YTW : 3.64 % |
| ENB.PR.Y | FixedReset Disc | 10,700 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2056-08-21 Maturity Price : 22.66 Evaluated at bid price : 23.38 Bid-YTW : 5.97 % |
| There were 0 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| See TMX DataLinx: ‘Last’ != ‘Close’ and the posts linked therein for an idea of why these quotes are so horrible. | ||
| Issue | Index | Quote Data and Yield Notes |
| FTS.PR.K | FixedReset Disc | Quote: 22.27 – 24.58 Spot Rate : 2.3100 Average : 1.2900 YTW SCENARIO |
| MFC.PR.Q | FixedReset Ins Non | Quote: 25.25 – 26.25 Spot Rate : 1.0000 Average : 0.7193 YTW SCENARIO |
| POW.PR.C | Perpetual-Premium | Quote: 25.31 – 26.00 Spot Rate : 0.6900 Average : 0.4428 YTW SCENARIO |
| GWO.PR.G | Insurance Straight | Quote: 23.80 – 24.50 Spot Rate : 0.7000 Average : 0.4881 YTW SCENARIO |
| BIP.PR.E | FixedReset Prem | Quote: 25.84 – 26.47 Spot Rate : 0.6300 Average : 0.4644 YTW SCENARIO |
| ENB.PR.F | FixedReset Disc | Quote: 24.00 – 24.70 Spot Rate : 0.7000 Average : 0.5383 YTW SCENARIO |