President Trump last week announced sweeping tariffs on $1.3 trillion worth of goods from China, Canada, and Mexico to reshape global markets and U.S. businesses that rely on imports. "MAKE YOUR PRODUCT IN THE USA AND THERE ARE NO TARIFFS!" he posted on Truth Social over the weekend. The three countries have already vowed retaliation.
It's worth noting that these are not the targeted, gradual, or incremental tariffs many-including Treasury Secretary Scott Bessant-have recommended, and the coming weeks should reveal whether they're a negotiating tactic or the first strike in a costly, drawn-out trade war. (It's also worth noting that Mexico and the U.S. have struck a last-minute deal to delay tariffs, and China and Canada are reportedly open to trade discussions with President Trump.) In any case, if tariffs come into force and inflation spikes as many expect, the Fed may have to tighten monetary policy, and economic activity could slow, particularly in the near- to medium-term.
Are you surprised by the sweeping nature of the tariffs? How do they affect your lending outlook? Are you concerned about rising rates and deposit competition? What else will you be watching?
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Rob Blackwell
Chief Content Officer and Head of External Affairs
IntraFi
Arlington, VA
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