Trump’s Wide-Ranging Tariff Hikes Now in Effect

After months of threats, reversals, tariff letters, and negotiations, higher customs duties on nearly all U.S. trading partners took effect just after midnight in New York.

The European Union, Japan, and South Korea agreed to a 15% tariff on exports to the U.S., including key categories such as automobiles.

Other countries face tariffs starting at 10% and rising to much higher levels.

Some nations’ last-ditch efforts to avoid steep duties have failed. Switzerland’s president left Washington without a deal to reduce a 39% tariff.

Trump also announced that tariffs on India—imposed over its purchase of Russian oil—would rise to 50% within three weeks.

Across all countries, the average U.S. tariff rate has climbed to 15.2%, far above last year’s 2.3% and marking the highest level since World War II.

Talks with Mexico, Canada, and China—America’s three largest trading partners—are continuing on a separate track, while Trump said new tariffs on critical sectors including pharmaceuticals and semiconductors will be announced soon.

Despite these developments, U.S. economic indicators still point to low unemployment.

Former U.S. trade negotiator Wendy Cutler warned that businesses are unlikely to sustain low profit margins in the long term, making “price increases almost inevitable.”

Source: BloombergHT