During a meeting with lawmakers, Treasury Secretary Scott Bessent informed them that the proposed tariffs would serve as a maximum threshold, indicating the highest levels they could reach. This information was relayed to CNBC by Representative Kevin Hern, a Republican from Oklahoma. The White House Press Secretary, Karoline Leavitt, stated earlier on Tuesday that the tariffs would be implemented immediately, but also mentioned that President Trump was willing to engage in subsequent negotiations.
Financial markets in Asia and Europe were on edge awaiting further details on Wednesday. Stocks continued their decline, Treasury yields remained close to one-month lows, and the price of gold approached its recent record high. Concerns regarding economic growth, consumer sentiment, and inflation were raised among central bankers in the US and other countries.
Despite widespread speculation, the White House refrained from disclosing specifics of Trump's plan on Tuesday, ahead of the formal announcement by the president.
As Trump's announcement deadline approached, speculations and discussions intensified among stakeholders in Washington and Wall Street. Reports suggested that Trump's aides were considering various options, including a more targeted approach and a potential flat 20% global tariff. Different proposals, such as a tiered tariff system and a reciprocal plan tailored to each country, were being reviewed. Final decisions on the tariff plan were yet to be made by the White House team during their discussions on Tuesday.
President Trump's decision-making process on reciprocal tariffs remained in the final stages, with the level and scope of new import taxes being finalized by his team. The announcement was scheduled for Wednesday afternoon, and various options were presented, including imposing levies on countries deemed to engage in unfair trade practices.
Approaches such as a tiered tariff system, reciprocal rates customized for each country, and a flat global tariff were under consideration. Despite ongoing deliberations, the details of Trump's plan were evolving rapidly, leading to uncertainty among stakeholders before the announcement.
The implementation of tariffs was expected to have a significant impact on imports, potentially affecting countries with which the US does not have trade imbalances. Negotiations with affected countries could lead to modifications in tariff rates over time. The administration aimed to generate substantial tariff revenue annually but faced challenges related to logistics and possible repercussions on the economy.
The fraught deliberations underscored the administration's keen interest in shaping US trade policy and reflected Trump's unorthodox approach to decision-making on key economic matters. The looming announcement sparked concerns among analysts over a possible recession and raised questions about the fate of existing tariffs and future trade deals.