Restaurant chains across the country are facing pressures due to President Trump's potential tariffs on Mexican and Canadian goods under the USMCA trade agreement. The National Restaurant Association warns that such tariffs could increase menu prices, burdening consumers.
Nick Setyan, Wedbush Securities managing director of equity research, joins Market Domination with Josh Lipton and Julie Hyman to discuss the impact of tariffs on the restaurant sector.
"The tariffs are largely going to impact produce ... so it's a relatively small percentage of restaurant cost," Setyan explains. "If anything, restaurants are probably the most insulated industry within consumer."
However, it is possible that restaurants will need to eventually "figure out ways to either source [ingredients] domestically or from other countries other than Mexico ... they've already started doing that with avocados, for example," Setyan tells Yahoo Finance.
Listen to the full video above to hear Setyan's observations on the growing sense of caution among American consumers, the role of the lower-income consumer in the economy, and more.
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This post was written by Josh Lynch