The July 9 deadline has come up with some tangible results to resolve disputes with the US trade partners. The only deal to be completed a week before the deadlineUnited kingdomAndVietnamAnd in May, the US interacted with China on a temporary Trus.
Until July 9, no new deal was announced this week.
Treasury Secretary Scott Besent had earlier indicated that the administration is focusing on 18 countries which are responsible for 95 percent of the US trade deficit. Those who receive letters for such countries said in a CNN interview on Sunday thatCountries that fail to reach trade agreementsBy 1 August, there will be “Bumerang back” by 1 August.
President Trump later announced on Monday that he would impose 25 percent tariff on goods from Japan and South Korea This will be applicable on 1 August if no deal has been done until then. Twelve other countries also found a pending tariff hike of 25-40 percent, close to the rates announced on 2 April.
On Thursday, Trump threatens Canada 35 percent tariff And floats high global rates 15-20 percent.
On 9 July, another batch went out, the most notable is a potential 50 percent tariff on Brazil which quoted“witch hunt”Former President, against Zayer Bolsoro.
While business talks have focused on mutual tariffs, a barrier for striking deals is existing and pending product tariffs.
Trump said that no regional-specific tariffs were included at the rate of 25 percent on Japan and South Korea which was with the administration or would be applicable. Both Japan and South Korea are major auto exporters and also face tariffs on steel, where the tariff rate is 25 percent and 50 percent respectively.
In a note for clients, the piper sandler’s Andy Laparrier states that, if fully applied, sectoral tariffs may apply to more than 40 percent of US imports. Financial Times reports that people familiar with talks quotedPossible new regional tariffs poor visibilityAs obstruction on obstacles on pharmaceuticals, semiconductors and other accessories.
Trump announced50 percent tariff on copperThis week which becomes effective by 1 August, and he threatened duties on pharmaceuticalsUp to 200 percent,
The US stock market response to this week’s announcements was compared to three months ago. One reason is that many investors have learned that Trump often does not follow through his dangers-“so-called”Taco“Or” Trump always bets out the chickens “.
Nevertheless, others wonder why they are adamant in taking all the business partners of America, even though despite their size and even those who run bilateral trade deficit with America
I have to take that Trump has strongly considered tariffs in the 1980s, and he will not return until the markets force their hand.
A factor in the stock market is that the impact of tariffs on American consumer prices has not been felt so far. The main reason is that businesses stored imported goods before the announcement of April 2 “Mukti Day” and are currently being reduced.
The manufacturers, service-oriented businesses and all the values of small businesses move forward. The Federal Reserve also hopes that they will soon become clear, which is why it is holding interest rates.
Meanwhile, the uncertainty related to tariffs and business war is equally weight on homes and businesses. While no one is in the sight of recession, it is contributing to a noticeable economic recession.
Economic policy uncertainty indexFor example, produced by Scott Baker, Nick Bloom and Steven Davis, showing that it exceeds the 2008 financial crisis and rivals from the Kovid -19 epidemic. The functioning is mainly based on the frequency of news stories that discuss the economic policy uncertainty.
Uncertainty for the first time in consumer trust surveys was clear, which fell before President Trump’s April 2 announcement.
It was with oneRecession in real personal consumption2.4 percent increase in the fourth quarter of 2024 to 0.8 percent at the annual rate in the first quarter. Softening continued in April and May, when consumption was slightly negative.
The increased uncertainty is also visible in the way the business is handling the labor force. In the first half of this year, there was a significant slow in private sector jobs, andJune jobs reportIt was not as strong as the headline number shows.
The private sector added 74,000 jobs, the smallest profit in eight months, while Tally was almost the same for the government sector, with most of the recruitment from state and local governments.
American businesses have been cautioned from laying workers in an event when trade struggle is resolved. At the same time, press accounts indicate that the approach for college grade and other new fare is very challenging.
Bright spot business capital expenses, which have been moving upwards over the last four years. As a result of the provision in Trump’s budget bill, it is expected to get an additional boostFull detail of spending on equipment and research and development,
Nevertheless, the financial time notes that it has become rapidly challenging to make it long -term for businesses.Decisions about supply chainsMany companies are resorting to organizing strategies, while they store imported goods in warehouses that allow importers to keep goods for up to five years.
Uncertainty about tariffs is also contributing to the merger and acquisition activity so far this year.
In the midst of all this, many investors believe that the risk of a complete trade war between the US and China is still the worst.
The global trade struggle, however, has effectively eliminated the post -war international trade system that has contributed to unique economic prosperity. Meanwhile, there is no clarity on what it will be replaced and how the country will face uncertainty.
Nicholas Sargane, PhD, Fort Washington is an economic advisor for investment advisors and is affiliated to Dordon School of Business University in Virginia. He has written three books, including “”Global shocks: an investment guide for disturbed markets.,
