The Blubber

President Donald Trump pushed back against Walmart on Saturday after the company said it would be raising prices due to the impact of his tariffs.

Walmart’s CEO, Doug McMillon, said during an earnings call on Thursday that the company was doing its best to keep prices low, but the high cost of tariffs—especially on Chinese imports—made that increasingly difficult. “Even with the reduced rates announced this week, we can’t absorb all of the pressure given our narrow retail margins,” he explained.

Trump responded on Truth Social, telling Walmart and China to “EAT THE TARIFFS” and not pass on the costs to customers. “I’ll be watching, and so will your customers!” he wrote.

Commerce Secretary Howard Lutnick echoed the president’s stance in a Sunday CNN interview, saying that “businesses and the countries primarily eat the tariff.” Former Treasury Secretary Larry Summers has dismissed that theory as “ludicrous.”

Economists say it’s consumers—particularly lower- and middle-income Americans, who make up a large part of Walmart’s customer base—who will likely feel the pinch. Because Walmart is often where people buy essential goods like groceries, price hikes will hit households hard.

Walmart reiterated in a statement to CNN that it will continue trying to keep prices down: “We have always worked to keep our prices as low as possible and we won’t stop. We’ll keep prices as low as we can for as long as we can, given the reality of small retail margins.”

The company’s finance chief, John David Rainey, told CNBC that price increases would begin by the end of May and rise “much more” in June.

Walmart operates over 4,600 stores across the U.S. and sources products from several countries—including China, India, Mexico, Canada, and Vietnam—all of which now face at least 10% in tariffs. Imports of steel, aluminum, cars, and auto parts are taxed at 25%.

McMillon said that while all tariffs raise costs, “the larger tariffs on China have the biggest impact.”

Trump initially raised tariffs on most Chinese goods to 145%, though that rate was lowered to 30% on Monday following a 90-day truce with Beijing. Still, he warned that tariffs could be “substantially higher” if a new deal isn’t reached.

Other countries are also in negotiations during the 90-day pause on reciprocal tariffs. Commerce Secretary Lutnick said base tariffs will remain at a minimum of 10% during the talks.

The ongoing trade war has weighed on consumer confidence. According to the University of Michigan, sentiment dropped 2.7% between April and May, approaching record lows as fears of a potential recession grow.

Walmart has already warned shoppers: prices on many items are going up.