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Trump Tariffs Undo Positive Impact of Tax Cuts

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President Donald Trump has embarked on an unorthodox follow-up to cutting the taxes American families pay: raising the prices of goods they buy.

Higher prices will result directly from tariffs the White House plans to impose on steel and aluminum imports from allies such as Canada, Mexico and the European Union as well as other countries. The White House acknowledges that effect, while arguing the price increases will be tiny.

But combined with additional tariffs against other imports from China and retaliatory steps by our trading partners, the measures Trump announced promise to make an impact. And mainstream economists across the political spectrum agree it will be negative.

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This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam

Senior Currency Analyst at OANDA
Based in London, England, Craig Erlam joined OANDA in 2015 as a Market Analyst. With more than five years' experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while conducting macroeconomic commentary. He has been published by The Financial Times, Reuters, the Wall Street Journal and The Telegraph, and he also appears regularly as a guest commentator on networks including Sky News, Bloomberg, CNBC and BBC. Craig holds a full membership to the Society of Technical Analysts and he is recognized as a Certified Financial Technician by the International Federation of Technical Analysts.
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