The first trading day under the new US administration began with an optimistic tone as comments regarding tariffs on China were more benign than anticipated. However, by contrast, the signaling of intentions to implement 25% universal tariffs on goods from Mexico and Canada beginning on February 1st were more hawkish than the market was expecting.
As Deutsche Bank indicated in a note this morning, placing tariffs on the approximately $900 billion of goods that flow into the US from Mexico and Canada can potentially increase prices for many consumer goods such as gas, groceries and vehicles quite noticeably. As Goldman Sachs also pointed out this morning, the odds of all these policies being enacted together is quite low, however the impact would be quite high even before the retaliatory tariffs that are likely to follow as they did in 2016.
January 21, 2025
The first trading day under the new US administration began with an optimistic tone as comments regarding tariffs on China were more benign than anticipated. However, by contrast, the signaling of intentions to implement 25% universal tariffs on goods from Mexico and Canada beginning on February 1st were more hawkish than the market was expecting.
As Deutsche Bank indicated in a note this morning, placing tariffs on the approximately $900 billion of goods that flow into the US from Mexico and Canada can potentially increase prices for many consumer goods such as gas, groceries and vehicles quite noticeably. As Goldman Sachs also pointed out this morning, the odds of all these policies being enacted together is quite low, however the impact would be quite high even before the retaliatory tariffs that are likely to follow as they did in 2016.