S&P Futures Updates

The Trump administration enacted new tariffs on numerous countries on Friday, citing alleged violations related to forced labour, as detailed in a notice published. The duties, established within a range of 10% to 12.5%, serve as a replacement for President Donald Trump’s temporary 10% global tariffs, which lapsed at 12:01 a.m. — coinciding with the implementation of the new rates. The tariffs are imposed on 60 trade partners and encompass 99.4% of U.S. trade, according to a fact sheet released by the Office of the U.S. Trade Representative on Thursday afternoon. The office separately informed that it was unable to provide an estimate regarding the revenue that the new tariffs will generate. The move “is the most sweeping international labor rights action the United States has ever taken — that any country has ever taken,” a senior Trump administration official told.

The official indicated that the new tariffs would not “stack” on top of existing import taxes on steel and aluminium, referred to as Section 232 duties, which were imposed by Trump last year on the basis of national security. The latest trade action highlights the Trump administration’s renewed commitment to an aggressive tariff strategy, following significant legal challenges to the president’s protectionist agenda earlier this year. Trump has consistently promoted tariffs as essential instruments for revenue generation and enhancing leverage over international trade partners, while dismissing critiques that they impose costs on U.S. importers and elevate prices for American consumers.

The White House recently imposed 25% tariffs on most U.S. imports from Brazil, effective Wednesday, and 50% tariffs on a wide range of goods from Canada, set to begin next month. The Trump administration proposed the upcoming tariffs in early June, after concluding that the targeted countries failed to effectively ban the use of forced labour practices in trade with the U.S. New tariffs are being implemented under Section 301 of the Trade Act of 1974, a trade instrument that Trump has utilised since the Supreme Court invalidated his global “liberation day” duties on February 20. Hours following the unfavourable court ruling, a visibly agitated Trump announced his intention to implement a global 10% tariff pursuant to Section 122 of the 1974 trade legislation.

However, that tariff was accompanied by a 150-day timer, which was scheduled to expire at 12:01 a.m. on Friday. In March, the Trump administration initiated two distinct Section 301 investigations: one focusing on forced labour practices, and the other addressing issues related to excess manufacturing capacity across 16 economies. The latter probe remains to be finalised. “We commit to continuing to use tariffs and to negotiate deals to support the reindustrialization of our economy, protect American workers, and increase their wages and shrink our trade deficit,” U.S. Trade Representative Jamieson Greer said in Senate testimony Wednesday.