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Dow Jones NewsJul 4, 4:56 PM UTC
DJ Trump Says Tariff Letters Imminent, Unsettling Markets -- 3rd Update
By Ed Ballard
President Trump said the U.S. is poised to inform many trading partners of unilateral tariff rates of up to 70%, putting global investors on the defensive with U.S. markets closed for July Fourth.
The notices will be sent to countries by July 9, the president said. That is the White House's self-imposed deadline for ending a 90-day pause on "reciprocal" tariffs first unveiled in April. He said the tariffs would kick in from the start of next month, telling reporters late Thursday: "They'll start to pay on Aug. 1."
The renewed trade tensions weighed on markets. Global investors were also considering the deficit-boosting megabill that is headed for the president's desk. As of late afternoon in London on Friday:
-- Futures pegged to the S&P 500 and the tech-heavy Nasdaq-100 slipped less than 1%. U.S. stocks had set records heading into the holiday weekend, after an unexpectedly strong jobs report. -- European and Asian benchmarks were mixed. South Korea's Kospi index fell 2%, while Japan's Nikkei 225 inched up 0.1%. The Stoxx Europe 600 dropped about 0.5%. -- The dollar weakened modestly against the Swiss franc and the Japanese yen.
"We're going to start sending letters out to various countries starting tomorrow," Trump told reporters. "We'll probably have 10 or 12 go out tomorrow, and over the next few days, I think by the 9th, they'll be fully covered. And they'll range in value from maybe 60 or 70% tariffs to 10 and 20% tariffs."
The higher end of that range would be more than almost all the "reciprocal" rates that Trump had floated earlier. Except for China, the highest of those was 50%.
The suggestion tariffs will take effect in August suggests the U.S. wants more time to continue pushing for agreements with key trading partners such as the European Union, Japan and South Korea, said Inga Fechner, an economist at ING.
"That's the most interesting takeaway because it would basically mean that he would leave more room for negotiations," Fechner said. Big trading partners would likely retaliate if the higher tariff rates kick in next week, she said.
So far, the administration has struck trade pacts with the U.K. and Vietnam, and an on-again, off-again truce with China.
The Trump administration has said it is giving priority to talks with a core group of trading partners, for whom Wednesday's deadline might be flexible, but that the U.S. doesn't have the capacity to negotiate in detail with every global counterpart. Last week, Treasury Secretary Scott Bessent said the U.S. "could have trade wrapped up by Labor Day" and is focused on deals with 18 key trading partners.
However, when asked in an earlier gathering with the media on Thursday about other agreements, Trump said: "We have a couple of other deals, but you know, my inclination is to send a letter out and say what tariffs they are going to be paying."
Meanwhile, there were fresh signs of a thaw in U.S.-China trade relations, after talks in London last month helped revive a truce between the two countries. The Chinese government said it is reviewing and approving applications for exports of controlled items to the U.S., as Beijing and Washington move faster to implement their trade framework.
In one example of shifting policy, the U.S. is allowing a GE Aerospace joint venture to restart engine deliveries to China's homegrown plane maker Comac, according to people familiar with the instruction. That ends a ban in place since late May. China had separately stopped its airlines from taking Boeing jet deliveries.
Write to Ed Ballard at ed.ballard@wsj.com
(END) Dow Jones Newswires
July 04, 2025 12:56 ET (16:56 GMT)
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