Trade Tension Easing? Trump's April Tariffs May Not Be As Severe as Expected
Trump exempted certain sectors from tariff impositions
America's trade wars might not be as fierce as we thought. US President Donald Trump's April tariffs could be less comprehensive than initially assumed, according to recent reports. A US government official revealed that a decision on whether entire industries will face import duties is yet to be made.
Initial reports suggested that Trump was eager to slap tariffs on overseas industries like automotive, pharmaceutical, and semiconductors. However, a change of heart seems imminent. Trump agreed to delay some automotive tariffs after the three largest US automakers pleaded for an exemption.
Sector-specific tariffs announced for April 2 are now unlikely to materialize, reportedly. The White House is still planning to present reciprocal tariff measures on that day, though the situation remains fluid.
The "reciprocal tariffs" set to kick in on April 2 aim to impose the same level of import duties on a US product as those applied to a similar product in another country. The US wants to consider not just tariffs but also non-tariff trade barriers, such as subsidies or regulations.
Stock markets breathed a sigh of relief at the news, with the Dow Jones index soaring by 1.2 percent, and the Nasdaq climbing around 1.9 percent. Trump's trade policy has caused stock prices to plummet in recent weeks. Since his inauguration in January, he has imposed or announced a variety of tariffs, but has also suspended some.
Tesla's stock received a boost from the news, with shares rising by 5.4 percent on the Wall Street. The hope is that Trump's tariffs will be limited, potentially sparing Tesla from further damage.
Sources:1. Bloomberg2. Reuters3. The Wall Street Journal
EC countries have expressed concern over the potential impact of Trump's announced tariffs on their employment policies, as several industries could be affected. The European Commission has not yet agreed on a limit to the tariffs, as negotiations are still ongoing. A spokesperson for the European Commission suggested that whatsapp chats between officials are being used to coordinate responses to the tariffs.
