Liberation Day Meltdown

Trump's tariffs roil the world

Get full access to Reuters.com for just $1/week. Subscribe now. Politics U.S. Politics U.S. By Jeff Mason, White House correspondent    President Donald Trump unveiled sweeping reciprocal tariffs for countries around the world on Wednesday, creating havoc in financial markets, ticking off foreign capitals, and raising the prospect of higher prices for U.S. consumers on a wide range of goods. Trump called it Liberation Day, but what he unleashed was, for many, anything but freeing. Latest U.S. politics headlines World girds for trade war in the wake of Trump's tariff shock Musk team issued inaccurate USAID firing notices, must send correct versions, say sources Exclusive: Trump administration moves to more easily fire some agency employees A $2,300 Apple iPhone? Trump tariffs could make that happen. US economy slowing heading into tariffs turbulence Tariffs and retaliations So ... how's everybody feeling? Surprised? Shocked? A little stunned? Trump's big trade announcement, which put a 10% baseline tariff on multiple nations and even bigger levies on China, the European Union, and others, certainly seemed to catch folks off guard with its breadth and severity. Stock markets fell, the euro climbed, and the bond market jumped.  Allow your friendly White House correspondent to say: this was all to be expected. Trump has been foreshadowing his plans for tariffs for ages, most notably on the campaign trail last year. His Liberation Day moniker only underscored how confident he was that applying these new fines on imported goods would lead to a reorientation of the economy and riches for the United States.  Most economists don't see it that way. And even Trump's Republicans are wary, with real concern that a slide into recession, sparked by the trade war Trump started, could hit them at the ballot box next year when Americans go to the midterm polls. Any fallout from Trump's bold move carries undeniable political risk for his party.  Trump's announcement sparked swift vows of retaliation. Big surprise there. China, which faces 54% tariffs on exports to the U.S., promised its own countermeasures. The EU did the same. The economic impact of the new tariffs extends far beyond the United States, with ramifications for a world economy that is still weathering lingering pandemic-induced inflation.  Don't expect sympathy in the corridors of the West Wing for consumers abroad. Trump made clear this week, as he has repeatedly before, his feeling that the rest of the world has ripped off the United States with tariffs and non-tariff barriers. But that doesn't mean he's not open to a deal. The phone lines from abroad will be busy in the coming weeks as countries seek ways to escape, or reduce, the levels of the new penalties.  Tariffs are just one more example of Trump using the levers of his presidency in extraordinary ways to get friends and foes to bend to his will. That's something he foreshadowed as a candidate, too, and as James Oliphant and I reported this week, he has used those powers to take on law firms, academia, the press, and other sectors in an onslaught that has drawn cheers from his supporters and outrage from his critics. Expect more of that. And more tariffs, too.   Americans give Trump poor marks on his handling of the economy, a new Reuters/Ipsos poll shows. Ahead of the new tariff announcement, the poll asked if the following are heading in the right direction or on the wrong track.   Follow Reuters/Ipsos polling on the president's approval ratings here. The view from Europe The European Union was swift in replying to Trump's tariff announcement, with the European Commission president saying it would be a major blow to the economy. The bloc will respond with countermeasures if talks with Washington fail. Photo of the week   U.S. President Donald Trump delivers remarks on tariffs in the Rose Garden at the White House in Washington, D.C., U.S., April 2, 2025. REUTERS/Carlos Barria  What to watch for April 5: Progressive advocacy groups hold a series of "Hands-off!" rallies around the country to protest Trump policies, including the firing of thousands of government workers.    April 8: Detained Columbia University student and pro-Palestinian activist Mahmoud Khalil due to appear before a federal immigration judge in Louisiana.  The who, what and when Can Donald Trump serve a third term as US president?  US farm, food groups largely critical of Trump tariffs  The list of proposed US tariffs  Find up-to-date elections coverage, interactive data and more on Reuters.com.  Sponsors are not involved in the creation of newsletters or other Reuters news content. Advertise in this newsletter or on Reuters' website Reuters Politics U.S. is sent once a week. Think your friend or colleague should know about us? Forward this newsletter to them. They can also sign up here. Want to stop receiving this email? Unsubscribe here. 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