Posted on 05/16/19
| News Source: Reuters
New York - Walmart Inc said on Thursday that prices for shoppers will go up due to higher tariffs on imports from China as the world’s largest retailer reported its best comparable sales growth for the first quarter in nine years.
Walmart shares rose 1.4% to $101.30 in premarket trade.
U.S. President Donald Trump increased tariffs on $200 billion worth of Chinese imports to 25% from 10% last week. The move is widely expected to raise prices on thousands of products including clothing, furniture and electronics. China retaliated on Monday, though on a smaller scale.
Walmart Chief Financial Brett Biggs told Reuters that higher tariffs will result in increased prices for consumers. He said the company will try to ease the pain, in part by working with suppliers’ “costs structures to manage higher tariffs.”
Biggs said the retailer has not seen signs of a slowdown in consumer spending, but he declined to comment on the health of the consumer in the near term.
Investors and analysts expect U.S. spending to slow this year against a backdrop of rising debt, tariffs and economic uncertainty.
U.S. retail sales unexpectedly fell in April as households cut back on purchases of vehicles and a range of other goods, reflecting a slowdown in economic growth after a temporary boost from exports and inventories in the first quarter.
Sales at Walmart’s U.S. stores open at least a year rose 3.4%, excluding fuel, in the quarter ended April 30. Analysts estimated growth of 3.1%, according to IBES data from Refinitiv. Read more at Reuters