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Tariff refunds are juicing corporate profits and GDP, as tailwinds converge to propel growth to 4.3%
Fortune • • business
Key Points:
- Forty companies in the S&P 500 have received $9.6 billion in tariff refunds, with Apple alone reporting nearly $2.2 billion, boosting corporate earnings and contributing to economic growth.
- Apollo Chief Economist Torsten Slok estimates that these refunds will add about 0.2 percentage points to third-quarter GDP growth, aiding a projected acceleration to 4.3% growth according to the Atlanta Fed.
- The tariff refunds, combined with factors like AI spending, tax cuts, and reshoring of manufacturing, are supporting ongoing economic momentum despite a weak July jobs report attributed to seasonal adjustments.
- Approximately 60% of the $166 billion in import tax revenues collected under the International Emergency Economic Powers Act have been refunded after the Supreme Court struck down the tariffs, with some consumers seeking direct refunds through lawsuits.
- Retailers are using returned tariff money to fund promotions and offset supply chain costs, while companies may also invest in technology or return capital to shareholders, according to Bank of America analysts.
