President Donald Trump‘s 10% baseline tariff on all imports from countries around the globe went into effect Saturday. The larger tariffs placed on 57 countries will take effect later next week.
The tariffs took effect at 12:01 a.m. ET Saturday at U.S. seaports, airports, and customs warehouses.
Trump’s announcement of the sweeping tariffs tanked the stock market on Thursday and Friday before the weekend reprieve. The S&P 500 hit its lowest point since April of 2024, dropping about 10.5% from market close on Wednesday.
Trading adversaries have already started lining up counter-tariffs to combat Trump’s new charges. China placed a 34% counter-tariff on the U.S., and the Washington Examiner reported they backed out of a TikTok deal after the tariffs were announced. Trump then extended the deadline to find new ownership for TikTok.
Trump justified the tariffs against China on Saturday morning, saying, “China has been hit much harder than the USA, not even close,” in a post on Truth Social.
“They, and many other nations, have treated us unsustainably badly. We have been the dumb and helpless ‘whipping post,’ but not any longer. We are bringing back jobs and businesses like never before. Already, more than FIVE TRILLION DOLLARS OF INVESTMENT, and rising fast! THIS IS AN ECONOMIC REVOLUTION, AND WE WILL WIN,” he added. “HANG TOUGH, it won’t be easy, but the end result will be historic. We will, MAKE AMERICA GREAT AGAIN!!!”
China said the U.S. needs to take its market reaction as a sign the tariffs aren’t working. “The market has spoken,” Chinese foreign ministry spokesman Guo Jiakun posted on Facebook. “Now is the time for the U.S. to stop doing the wrong things and resolve the differences with trading partners through equal-footed consultation.”
Germany and Canada, along with other nations, are also considering countermeasures. At least Italy, Australia, and Mexico have announced they will not seek a counterpunch. Italy and Australia fear issuing reciprocating tariffs will raise prices or damage their economy, while Mexico is seeking other solutions besides a “tit-for-tat on tariffs.”
Trump believes the declining markets will rebound and has likened the U.S. to a sick patient who needs help, suggesting he is healing the nation with his tariff plan but that it will require some bumps in the road.
He’s also hoping for an interest rate cut from Federal Reserve Chairman Jerome Powell, one of the few holdovers from his first administration and Biden’s. Such a cut could boost the stock market.
“This would be a PERFECT time for Fed Chairman Jerome Powell to cut Interest Rates,” Trump said in a post on Truth Social. “He is always ‘late,’ but he could now change his image, and quickly. Energy prices are down, Interest Rates are down, Inflation is down, even Eggs are down 69%, and Jobs are UP, all within two months – A BIG WIN for America. CUT INTEREST RATES, JEROME, AND STOP PLAYING POLITICS!”
Powell has signaled that he is unlikely to cut interest rates in a speech Friday. “While uncertainty remains elevated, it is now becoming clear that the tariff increases will be significantly larger than expected,” he said. “The same is likely to be true of the economic effects, which will include higher inflation and slower growth.”
“While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent,” he concluded.
TRACKING WHAT DOGE IS DOING ACROSS THE FEDERAL GOVERNMENT
In response to rising inflation, the Federal Reserve typically raises rates, though Powell said the Federal Reserve isn’t in any rush to decide on that.
“We’ve taken a step back and we’re watching to see what the policies turn out to be and the ways in which they will affect the economy, and then we’ll be able to act,” he said.
