Investor sentiment is shifting fast. This week’s Steady Investor breaks down what’s driving the moves—and what to watch next:
- Tariffs on the U.S. automotive sector move lower
- Housing market misses rebound expectations
- Retail prices steady—for now
Tariffs on the U.S. Automotive Sector Move Lower – In a pattern that market participants should arguably have come to expect, the Trump administration has reduced the overall level of tariffs on the U.S. automotive sector. The changes are intended to prevent cumulative duties on the industry and offer a temporary financial cushion to firms affected by recent trade measures.
Under the new policy, automakers will not be required to pay overlapping tariffs. The 25% tariff on foreign-made vehicles, which went into effect earlier in April, will no longer be combined with existing levies such as those on imported steel and aluminum. The policy will apply retroactively, potentially allowing automakers to recover previously paid overlapping tariffs.
Additionally, the administration will ease the impact of the upcoming 25% tariff on foreign auto parts, which is scheduled to take effect on May 3. Auto parts sourced from Canada and Mexico that comply with the U.S.-Mexico-Canada Agreement (USMCA) will continue to be exempt from tariffs. This includes both U.S.-based and foreign automakers with domestic production operations. These revised policies are designed to give automakers time to locate and transition to new domestic suppliers without bearing the full cost of the tariffs immediately. Even still, a baseline 25% auto tariff could significantly raise consumer costs, with some estimates suggesting the average price of a vehicle could rise by as much as $6,000, representing a 10% to 12% increase. The tariff rollback is the latest shift in the administration’s trade policy, which again has generally followed the pattern of very loud on the bark but more modest on the bite.1
What Happens to Your Retirement Income When Rates Are This Uncertain?
The Fed raised rates aggressively in 2022 and 2023 to fight inflation—boosting yields on cash and bonds. But now? Tariffs, inflation, and economic uncertainty have made the Fed’s next move unclear.
And with inflation still elevated, today’s “real yields” may not be enough.
Get our guide, Retirement’s Uphill Battle: Generating Income in a Shifting Interest Rate Environment 2, to learn how to secure your cash flow. Topics covered include:
- The downsides of other income-producing options, such as annuities and closed-end funds (CEFs)
- How dividend stocks can help reduce downside volatility
- The importance of choosing the right corporate bonds and dividend stocks
- The tax advantages of dividend stocks
- Plus, many more reasons this strategy can help you generate income in retirement
If you have $500,000 or more to invest, click the link below to download our free guide today!
Retirement’s Uphill Battle: Generating Income in a Shifting Interest Rate Environment. 2
U.S. Existing Home Sales Show Little Sign of Major Turnaround – Sales of existing homes in the U.S. saw a significant setback in March 2025, falling 5.9% from the previous month to an annualized rate of 4.02 million units. This marked the largest month-over-month decline in over two years and the slowest pace for any March since 2009, during the height of the financial crisis.The steep drop contradicted expectations for a spring rebound in the housing market. Traditionally the busiest season for home buying and selling, spring often sees a surge in activity driven by families seeking to move before the next school year. However, this year, an uptick in inventory outpaced demand, reflecting a growing number of sellers re-entering the market despite mortgage rates holding firm. The average 30-year fixed mortgage rate remained nearly unchanged at 6.81% last week, according to Freddie Mac.Economists had predicted only a 3.1% decline for the month, underscoring how much worse the actual outcome was. On a year-over-year basis, March sales were down 2.4%. The national median existing-home price rose to $403,700 in March, up 2.7% year-over-year and the highest ever recorded for the month of March. Buyers are regaining leverage, however. Data from Redfin shows that 44% of first-quarter purchases included some form of seller concession, ranging from price reductions to contributions toward closing costs or interest rate buydowns. Nonetheless, affordability remains a major hurdle, especially for first-time buyers, as mortgage rates persist in the 6.5% to 7% range.3
Could Prices for Goods at U.S. Retailers Be on the Verge of Going Up? Despite the surge in tariffs on imports, major U.S. retailers have so far managed to keep consumer prices largely stable. According to a Wall Street Journal analysis of 10,000 everyday items sold by Walmart, Target, and Amazon, the average prices of household goods have remained effectively flat since early April and are even lower compared to January levels.Retailers’ ability to keep prices stable have come because of defensive strategies designed to absorb rising costs. These include pressuring suppliers to shoulder more of the tariff burden, stockpiling inventory ahead of tariff hikes, pausing certain shipments from China, and scaling back internal corporate perks to reduce overhead. Major retailers are also requesting greater advertising commitments in an effort to bolster margins, which can become a critical tool for retailers to offset higher supply chain costs stemming from tariffs. These measures have largely been effective over the short-term, but industry leaders and supply chain analysts are warning that the combination of persistent high tariffs—such as the 145% duties still in place on Chinese imports—and rising logistical challenges could push retailers to implement widespread price hikes later this year. Shipping data already shows a sharp decline in the number of cargo ships departing China for the U.S., and it is likely only a matter of time before consumers start to notice the effects in the form of higher prices and more empty store shelves.4
Income Strategies That Work Beyond the Rate Cycle – Retirement income isn’t simple in today’s uncertain environment. Inflation, shaky yields, and unclear rate direction make traditional options less reliable.
Download our free guide, Retirement’s Uphill Battle: Generating Income in a Shifting Interest Rate Environment5, to learn how a smarter strategy combining high-quality bonds and dividend-paying stocks can help protect your income.
Topics covered include:
- The downsides of other income-producing options, such as annuities and closed-end funds (CEFs)
- How dividend stocks can help reduce downside volatility
- The importance of choosing the right corporate bonds and dividend stocks
- Plus, many more reasons this strategy can help you generate income in retirement
If you have $500,000 or more to invest, click the link below to download our free guide today!
Disclosure
1 Wall Street Journal. April 29, 2025. https://www.wsj.com/business/autos/trump-tariffs-autos-exceptions-fc634efd?mod=business_lead_story
2 Zacks Investment Management reserves the right to amend the terms or rescind the free Retirement’s Uphill Battle: Generating Income in a Shifting Interest Rate Environment offer at any time and for any reason at its discretion.
3 Wall Street Journal. April 24, 2025. https://www.wsj.com/economy/housing/home-sales-march-2025-drop-mortage-rates-1f9a6047?mod=economy_feat6_housing_pos1
4 Wall Street Journal. April 29, 2025. https://www.wsj.com/business/retail/tariff-price-increases-walmart-target-amazon-a95a8538?mod=business_feat4_retail_pos1
5 Zacks Investment Management reserves the right to amend the terms or rescind the free Retirement’s Uphill Battle: Generating Income in a Shifting Interest Rate Environment offer at any time and for any reason at its discretion.
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