US President Donald Trump announced a 25% tariff on most imports from Canada and an additional 10% tariff on Chinese goods, effective Tuesday. The move is expected to have significant impacts on global trade and the US economy.
The tariffs are part of a broader effort by Trump to reduce reliance on foreign-made goods and promote American manufacturing. However, critics argue that the move could lead to higher prices for consumers, damaged supply chains, and economic instability.
Major banks and analysts warn that the tariffs will have far-reaching consequences, including increased costs for businesses, potentially disrupting global trade flows. The Dow Jones fell by 122 points Monday after tumbling nearly 600 points at the opening bell, while European indexes suffered sharp losses.
Energy costs are expected to surge due to Canadian tariffs, which are set to go into effect Tuesday. Diesel and jet fuel prices will rise, according to KPMG energy sector lead Angie Gildea.
The move has already sparked a global trade war, with Canada ordering retaliatory tariffs and China vowing to take necessary countermeasures. The US may launch even steeper tariffs in response.
Business groups and farmers are urging the Trump administration to offset the costs of the tariffs with government funds or subsidies. Goldman Sachs predicted that the tariffs will be short-lived, but analysts noted the outlook is unclear.
The experiment appears to be on, as the impact of Trump’s tariff campaign becomes clear. With $1.4 trillion in imported goods at stake, the consequences for American consumers and businesses will be significant.
Source: https://edition.cnn.com/2025/02/03/business/tariffs-trump-imports-us/index.html