Trump to announce 25% tariffs on steel, aluminum imports
What's the story
United States President Donald Trump will announce a 25% tariff on all steel and aluminum imports on Monday.
The new tariffs will be applicable universally, without any date of implementation.
Further, the president plans to introduce reciprocal tariffs later this week on countries that tax US imports.
These additional tariffs are likely to be announced by Tuesday or Wednesday but won't come into effect immediately.
Sector concerns
US energy sector braces for impact of new tariffs
The new tariffs could deal a severe blow to the US energy sector, which heavily depends on specialty grades of metal not produced domestically. This includes wind developers and oil drillers.
In Trump's first term, some oil companies were granted exclusions from similar tariffs.
It is still unclear if Mexico and Canada, major suppliers of metals to the US, will be exempt from these new tariffs.
Tariff targets
Trump's tariff strategy and potential targets
The extent of Trump's wider tariff ambitions is unclear. Possible duties are also being eyed on pharmaceuticals, oil, semiconductors, and even imports from the European Union.
Last week, Trump slapped a 10% tariff on Chinese goods. Following the US president's move, China announced retaliatory measures on $14 billion worth of US imports in 2024.
Trade tensions
US-China trade relations under scrutiny amid new tariffs
The market is keenly looking for a possible deal between the US and China before China's retaliatory tariffs come into effect on February 10.
White House Press Secretary Karoline Leavitt said a call between Trump and Chinese President Xi Jinping is being scheduled "very soon."
Trump has oscillated between tough rhetoric against Beijing and trying to work with Xi for balanced trade relations.
Economic impact
Trump's economic strategy and warnings from economists
Tariffs have been at the core of Trump's economic strategy to curb trade deficits and fund his tax agenda.
However, economists caution these levies could hike costs for manufacturers importing goods, increase consumer prices amid inflation fears, decrease trade flows, and not yield the anticipated revenue.
The announcement comes as the US steel industry struggles to recover from its worst year since Trump's first term.