Earlier this year, the Supreme Court ruled 6-3 that President Trump exceeded his authority by using the International Emergency Economic Powers Act to impose broad, worldwide tariffs. But tariffs continue to grab trade headlines. Ben Malin, Vice President of Research at the Federal Reserve Bank of Minneapolis, says tariffs have been and continue to be a favorite bargaining chip of the president.
“Tariffs, which really is a continuation of a big theme from last year. So, spring of 2025 seeing Liberation Day, and even before that, you know, tariffs on Mexico, Canada, and China being introduced. Activities this year has been the Supreme Court striking down some of those tariffs, temporary tariffs being put into place that last through this month, and now this month some questions about what will come next.”
But even with some tariffs set to expire soon, Malin says more could be on the way.
“New tariffs based on so-called Section 301 investigations are expected to be announced later this month or early next month, and so the question is, how will they affect the average effective tariff rate that the economy is facing? If any, what exemptions will be in place, and so on. So we could see maybe a slight bump off in tariff rates, or rates, or actually even in a cut from the tariff rates that we’re facing today.”
Section 301 tariffs are trade penalties imposed under the Trade Act of 1974, which allows the U.S. Trade Representative to investigate and respond to unfair trade practices by other countries. The announcement of those tariffs is expected soon.