President Donald Trump is taking aim at Walmart after the retail giant warned of potential price hikes tied to new tariffs. In a pointed message shared over the weekend, Trump urged Walmart to shield consumers from rising costs, asserting that the company, along with Chinese exporters, should absorb the financial burden of the tariffs rather than pass it along to American shoppers.
The confrontation between Trump and Walmart comes as retailers across the country brace for the broader impact of tariffs that now affect more than 40% of Chinese exports to the U.S. Walmart executives have signaled that price increases could begin as early as this month, with further adjustments in June. Chief Financial Officer John David Rainey stated that the magnitude of the tariff-related cost pressures exceeds what most suppliers and retailers can absorb without affecting pricing.
Trump responded publicly, writing on Truth Social, “Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain… They should ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING. I’ll be watching, and so will your customers!”
His comments land at a tense moment for the U.S. economy, with Moody’s recently downgrading the country’s sovereign credit rating—a move some analysts have attributed to concerns over the economic consequences of the aggressive tariff strategy. The downgrade helped drive Treasury yields higher, reflecting increased borrowing costs for the U.S. government. Walmart’s stock slipped more than 1% as markets reacted to the uncertainty.
In response, Walmart reiterated its commitment to maintaining low prices but noted the challenges of operating within narrow retail margins amid increasing costs. CEO Doug McMillon acknowledged that food prices could climb due to tariffs on imports from Colombia, Costa Rica, and Peru.
Treasury Secretary Scott Bessent, speaking on national television, confirmed that he had spoken directly with McMillon. According to Bessent, Walmart plans to absorb part of the tariff costs, as it had done in previous years, but he denied that the White House was demanding the retailer do so. Bessent added that the administration believes lower gas prices would help counterbalance potential inflation, although some consumer price pressures are still expected.
Retail analysts caution that Walmart’s actions could influence the broader market. If the country’s largest retailer raises prices, competitors may feel justified in doing the same. “Walmart is firing the starting gun on a period of price increases,” said Neil Saunders, managing director at GlobalData. The decision could pave the way for similar moves by companies like Target, Home Depot, and Lowe’s, all of which are due to report earnings this week.
Recent data from the Bureau of Labor Statistics suggested that many companies had initially absorbed the impact of tariffs, holding off on passing costs to customers. However, that restraint may be nearing its limit as trade tensions persist and economic pressures mount. The outcome of this standoff between Trump and major retailers could shape pricing strategies and consumer costs in the months ahead.
