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RMS
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5 days

There’s finally inflation from tariffs — in Hermes bags - MarketWatch

1. Hermes raised prices by 7% globally and 5% in the U.S. 2. Price hikes are to offset a 15% tariff burden. 3. Luxury products, like Birkin bags, show price inelasticity. 4. U.S. inflation has been stable at 2.7% over the past year. 5. Fed remains cautious about tariff impacts on consumer prices.

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FAQ

Why Neutral?

Despite Hermes' price increases, luxury items remain inelastic, limiting downturn effects. Historical examples show luxury brands often withstand price fluctuations without significant impact on demand.

How important is it?

Hermes' pricing strategies and inflation stability may forecast RMS's market resilience. However, a direct correlation to RMS is limited.

Why Short Term?

Immediate effects may be felt during price adjustments but seem limited long-term as luxury demand persists. Similar instances in the past have shown resilience in luxury markets quickly absorbing costs.

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