The beginning of August marks the latest deadline for US president Donald Trump’s “liberation day” tariff policy. This era of chaos and uncertainty began on April 2 and the situation remaims fluid. With the deadline for partners to secure a deal with Washington now passed, it’s a good time to take a broader view and consider if Trump’s trade gamble is paying off.
The objectives of the tariff policy include raising tax revenues, delivering lower prices for American consumers, and boosting American industry while creating manufacturing jobs. The president has also vowed to get better trade deals for the US to reduce its trade deficit and to face down China’s growing influence on the world stage.
But recently the US Federal Reserve voted to keep interest rates unchanged at 4.25% to 4.5%, despite pressure from Trump to lower them. In his monthly press briefing, Federal Reserve chair, Jerome Powell, said they were still in the early stages of understanding how the tariff policy would affect inflation, jobs and economic growth.
