Trump's tariff hammer: Court stops interference with presidential power!

Trump's tariff hammer: Court stops interference with presidential power!

Donald Trump had an eventful week that has a significant impact on the US economy and international trade. A New York trade court has taken away his ability to impose tariffs by decree. This ruling is the result of a lengthy legal dispute that addresses the limits of presidential powers. Trump originally imposed the tariffs under the International Emergency Economic Powers Act (IEEPA), which allows him to take action in the event of “extraordinary and unusual threats.” However, the court ruled that the existing trade deficit did not pose such a threat, blocking most of the tariffs it imposed on imported goods.

The appeals court conditionally reinstated the tariffs imposed on April 2nd, but Trump's options in the tariff war have not yet been fully exhausted. The decision to block the tariffs is seen as a victory for the states that sued. Products from countries such as China, Mexico and Canada, which have been classified as prohibited, are particularly affected.

Impact on the US economy

The situation in the US economy is tense. The economy shrank in the first quarter and private consumption showed weakness. Companies are trying to buy foreign goods before potentially high tariffs take effect. Uncertainty over future trade deals and legal disputes over tariffs are destabilizing ongoing trade negotiations with more than a dozen countries.

The White House announced that it would appeal the ruling and described the block as an inadmissible interference with presidential authority. Financial markets reacted positively to the ruling, leading to a rise in the US dollar and boosting stock markets in Europe and Asia. Companies that suffered from the tariffs are expecting refunds of the duties they paid, another indication of the far-reaching economic consequences of these court decisions.

Legal basis of customs duties

It is important to note that tariffs on steel and aluminum remain in place since they were imposed under the Trade Expansion Act of 1962. Tariffs on cars and car parts also remain in force because they were introduced under a different legal basis.

Overall, the current situation shows how complicated and dynamic the trade war is under the Trump administration. With the decisions of the courts and the current economic challenges, the US economy faces an uncertain future.