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Donald Trump said he would on Monday impose 25 per cent tariffs on all steel and aluminium imports, expanding his trade conflicts to the metals sector in a new burst of protectionism from Washington.
The US president made the announcement during a briefing with reporters as he flew from his Mar-a-Lago estate in Florida to attend the Super Bowl in New Orleans on Sunday evening.
In addition to the measures on steel and aluminium products, Trump said he would later in the week unveil new reciprocal tariffs targeting imports from a wide range of countries that impose levies on US exports.
The promised tariffs on steel and aluminium come as Trump has launched his second term with an aggressive trade policy. Last week he came within hours of setting 25 per cent tariffs on imports from US neighbours Canada and Mexico, only to offer them a 30-day reprieve.
But Trump has pressed ahead with 10 per cent tariffs on Chinese imports, which triggered retaliation from Beijing that took effect on Sunday.
The new levies on steel and aluminium proposed by Trump could again rattle global financial markets, which have whipsawed in recent weeks as the US president threatened America’s trading partners with additional tariffs.
The dollar rose 0.3 per cent on Monday against a basket of currencies including the euro, yen and pound. Aluminium traded on the London Metals Exchange rose 0.5 per cent to $2,633 per tonne.
While tariffs on metals imports are generally championed by some key trade unions in the US and by some domestic steel and aluminium producers, they risk raising input costs for a wide range of US manufacturers. In 2023, the US imported $82.1bn of steel and iron and $27.4bn of aluminium, while exporting $43.3bn of steel and iron and $14.3bn of aluminium.
The move comes as Trump has pledged to block Nippon Steel’s takeover of US Steel following Joe Biden’s decision to do the same.
But Trump has said he would work on allowing a large investment, though not a majority stake, in the Pennsylvania-based producer by its Japanese rival, and insisted that tariffs would help. “Tariffs are going to make [US Steel] very successful. And I think it has good management,” Trump said.
Shares in Nippon Steel were 1.6 per cent lower in Tokyo by mid-morning on Monday.
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If Trump follows through with his plan to impose metal tariffs and a wide range of additional levies, they will reignite concerns that his economic policies could trigger a fresh rise in inflation within the US economy and beyond.
Trump did not say how exactly he intended to apply the reciprocal tariffs he promised to announce in the coming days.
“Very simply, if they charge us, we charge them,” he said.
His comments could trigger a rush by America’s trading partners to avoid the looming tariffs in the coming days. Last week, after meeting Japanese Prime Minister Shigeru Ishiba, Trump threatened to impose tariffs on the Asian nation if the bilateral trade deficit with the US were not eliminated.
Additional reporting by Sam Learner in New York and Arjun Neil Alim in Hong Kong