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Donald Trump The U.S. president, who promised during his presidential campaign in 2016 that he would get tough on trade with countries like China and Mexico, has had limited success so far. Trump's strategy is to negotiate bilateral deals with individual nations rather than through the World Trade Organization (WTO) as previous administrations did. But the degree of uncertainty about trade policy has basically exploded, said Maurice Obstfeld, senior fellow at the Peterson Institute for International Economics.? Trump's actions have worried investors and triggered a stock market sell-off on Monday. The Dow Jones Industrial Average fell 425 points.? Trade experts have suggested that Trump is trying to put pressure on countries with which he wants new deals. But it is unclear whether this will work. For example, in the case of China, it's not clear what concessions they would be willing to make, said James Bacchus, a former WTO general council chairman who now works as an international lawyer and trade mediator. But some analysts believe that the tactic could lead to more friction with U.S. trading partners and put global growth at risk.? The White House has defended its tactics, saying it is necessary to protect American industry from unfair competition and support domestic jobs. But some argue the tactic is more about politics than economics -- a way for Trump to show he is keeping campaign promises to bring back manufacturing jobs. In the meantime, consumers could face higher prices on cars and other goods. Some companies have already announced price hikes due to the tariffs. For example, Nucor, one of the largest steel producers in the U.S., said it will raise prices by $200 a ton. Similarly, United States Steel has also announced that it would hike prices as much as 25 percent on its imports from Brazil and Mexico. Many nations have vowed retaliation, threatening to escalate the global trade war and hurt American consumers and businesses.? Trump's tactics are also being closely watched in Europe. The European Union could announce retaliatory tariffs of its own this week.?
Donald Trump The U.S. president, who promised during his presidential campaign in 2016 that he would get tough on trade with countries like China and Mexico, has had limited success so far. Trump's strategy is to negotiate bilateral deals with individual nations rather than through the World Trade Organization (WTO) as previous administrations did. But the degree of uncertainty about trade policy has basically exploded, said Maurice Obstfeld, senior fellow at the Peterson Institute for International Economics.? Trump's actions have worried investors and triggered a stock market sell-off on Monday. The Dow Jones Industrial Average fell 425 points.? Trade experts have suggested that Trump is trying to put pressure on countries with which he wants new deals. But it is unclear whether this will work. For example, in the case of China, it's not clear what concessions they would be willing to make, said James Bacchus, a former WTO general council chairman who now works as an international lawyer and trade mediator. But some analysts believe that the tactic could lead to more friction with U.S. trading partners and put global growth at risk.? The White House has defended its tactics, saying it is necessary to protect American industry from unfair competition and support domestic jobs. But some argue the tactic is more about politics than economics -- a way for Trump to show he is keeping campaign promises to bring back manufacturing jobs. In the meantime, consumers could face higher prices on cars and other goods. Some companies have already announced price hikes due to the tariffs. For example, Nucor, one of the largest steel producers in the U.S., said it will raise prices by $200 a ton. Similarly, United States Steel has also announced that it would hike prices as much as 25 percent on its imports from Brazil and Mexico. Many nations have vowed retaliation, threatening to escalate the global trade war and hurt American consumers and businesses.? Trump's tactics are also being closely watched in Europe. The European Union could announce retaliatory tariffs of its own this week.?
Trump's Tariff Tactics May Reshape Global Trade -- Analysts
Since his inauguration on January 20, Trump has unveiled and paused blanket tariffs on Canadian and Mexican goods over migration and illegal fentanyl, and hiked duties on Chinese imports in the same breath, triggering retaliation.
And on Monday he imposed sweeping steel and aluminum levies, drawing comparisons to his first term when he imposed duties across both sectors before allowing exemptions.
Trump sees tariffs as a way to raise revenue, remedy trade imbalances and pressure countries to act on U.S. concerns. But the degree of uncertainty about trade policy has basically exploded, said Maurice Obstfeld, senior fellow at the Peterson Institute for International Economics.
For consumers, there could be an impact on prices for cars and other goods.
Analysts also believe that retaliation from trading partners such as China, Canada, Mexico or the European Union could have broader economic implications.
If people start to worry about U.S.-China tensions escalating into a trade war then I think that's going to spill over to the stock market, said Mark Zandi, chief economist for Moody's Analytics. I don't think it has yet but if this escalates further then we're going to see some spillovers.
In the meantime, consumers could face higher prices on cars and other goods.
Some companies have already announced price hikes due to the tariffs. For example, Nucor, one of the largest steel producers in the U.S., said it will raise prices by $200 a ton.
Similarly, United States Steel has also announced that it would hike prices as much as 25 percent on its imports from Brazil and Mexico.
Trump's administration has argued that higher tariffs are necessary to protect American industry from unfair competition and support domestic jobs.
But some argue the tactic is more about politics than economics -- a way for Trump to show he is keeping campaign promises to bring back manufacturing jobs.
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