(Feb 18): Costs for US manufacturers climbed at the fastest pace in two years, according to a Federal Reserve Bank of New York survey, as President Donald Trump rolls out new tariffs on imports that may add to price pressures.

Measures of prices paid and received by producers both climbed for a second month in the New York Fed’s February manufacturing survey published Tuesday. The prices paid index jumped 11 points to 40.2, the highest in nearly two years.

The factory data follows higher-than-expected US consumer prices in January, and may be another signal that encourages the Federal Reserve to delay interest-rate cuts amid concern about a rebound in inflation. Trump’s trade plans are adding to the uncertainty, with a new 10% tariff on China imports taking effect this month and a slew of others due over the coming weeks.

Since Trump’s election win, some businesses and consumers have sought to get ahead of potential tariffs by bringing purchases forward. That may help explain the February jump in factory prices, according to Oliver Allen, senior US economist at Pantheon Macroeconomics. It “might be a sign that the tariff-linked surge in demand for durable goods since late last year is starting to put some upward pressure on prices,” he wrote.

Overall, the headline business conditions index in the New York Fed’s February survey climbed 18 points to 5.7, while measures for firm optimism and future business activity both declined sharply.

The New York Fed’s survey responses were collected between Feb 3-11. The survey is sent on the first day of each month to the same pool of about 200 manufacturing executives in New York State, typically the president or CEO. About 100 responses are typically received.

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