April showers: For better or worse, answers are coming for trade policy

Wells Fargo Research Team Wells Fargo

Summary

This year, it is April that comes in like a lion, with the effective date for a range of tariff policies slated for April 2. It will not go out like a lamb either, with Q1 GDP at the end of the month showing just how much of a drag the trade gap exerted in Q1.

In a climate of uncertainty, April will bring some hard details

The latest batch of new tariff policies is earmarked for April 2. Prior deadlines have seen postponements, and news outlets have reported that the original list of tariffs is being pared. Still, barring further exclusions, a litany of new or increased levies are set to go into effect next week.

New tariffs guidance generally falls into four buckets: The first is products from Canada and Mexico falling under USMCA, after a one-month delay. Next are European products, where tariff threats range from a 25% universal tariff to a 200% tariff on European wine or addressing value-added taxes. The next potential tranche addresses specific sectors such as autos or pharmaceuticals. Last are the reciprocal tariffs, which aim to hit U.S. imports from foreign countries by an equal amount that they levy on imports from the U.S.

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Wells Fargo Research Team

Wells Fargo

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