Bloomberg Daybreak: Asia Edition Trump Vows No Tariff Extension, Hardens Threats on Copper, Drugs
Trump’s Tariff Showdown: No More Extensions and Copper Hits 50% Tariff
President Trump announced he will not offer any more extensions on the aggressive tariffs scheduled to take effect in early August, signaling a hardened stance on trade enforcement. He also plans to impose a substantial 50% tariff on imported copper, which is notable given copper prices have recently surged 6.4% alongside other commodities like silver and oil.
Economic strategist Frances Stacy explains this move could drive further inflation reacceleration in the third quarter, with potential multi-stage price hikes across supply chains. This scenario complicates the Federal Reserve's rate strategy, amid a tense fiscal environment and speculation of stagflation — a combination of slow growth and persistent inflation.
The shifting trade deadlines appear to be a deliberate strategy to manage market volatility, keeping the outcomes uncertain and pricing unpredictable for investors and companies alike. Corporate America faces margin compression as businesses attempt to preemptively adjust costs and pricing to absorb tariff impacts, all while consumers are already financially stretched.
Strategic Deadline Shifts
- The Trump administration strategically shifts trade negotiation deadlines to manage market volatility.
- This tactic keeps markets from immediately pricing in outcomes, stabilizing equity and bond markets temporarily.
Copper Tariffs Could Boost Inflation
- A potential 50% tariff on imported copper could push commodity prices and inflation higher.
- This contributes to concerns of sustained inflation reacceleration impacting the economy and Fed policy.