Trump Says Countries Will Face Tariffs Ranging From 15% To 50%

Olivia Brooks

Economic

Political

China–U.S. Trade War

Summary:

US President Donald Trump suggested that he would not go below 15% as he sets so-called reciprocal tariff rates ahead of an Aug. 1 deadline, an indication that the floor for the increased levies was rising.

“We’ll have a straight, simple tariff of anywhere between 15% and 50%,” Trump said Wednesday at an AI summit in Washington. “A couple of — we have 50 because we haven’t been getting along with those countries too well.”

Trump’s comment declaring that the tariffs would begin at 15% represented the latest twist in his effort to impose duties on nearly every US trading partner, and the latest indication that Trump was looking to more aggressively impose the levies on exports from countries outside the small group that so far has been able to broker trade frameworks with Washington.

Trump earlier this month said that more than 150 countries would receive a letter including a tariff rate of “probably 10 or 15%, we haven’t decided yet.” Commerce Secretary Howard Lutnick told CBS News on Sunday that small countries including “the Latin American countries, the Caribbean countries, many countries in Africa” would have a baseline tariff of 10%. And at the first announcement of the tariffs in April, Trump unveiled a universal tariff of 10% on nearly every country.

While Trump and his advisers initially expressed hopes of securing multiple deals, the president has been touting the tariff letters themselves as “deals” and suggesting that he is uninterested in back-and-forth negotiations. Still, he has left the door open for countries to make agreements that could lower those rates.

On Tuesday, Trump announced he was reducing a threatened 25% tariff on Japan to 15% in exchange for the country removing restrictions on some US products as well as offering to back a $550 billion investment fund. Other nations, including South Korea, India, and members of the European Union, are still pushing for an agreement before the heightened tariffs go into effect.

On Wednesday, Trump said he would “have a very, very simple tariff for some of the countries” because there were so many nations that “you can’t negotiate deals with everyone.” He said talks with the European Union were “serious.”

Source: Yahoo Finance

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Manuel

Central Bank

Economic

The European Central Bank was set to keep interest rates on hold on Thursday, pausing after seven straight cuts as it waited for the fog surrounding Europe's trade relations with the United States to clear.

The ECB has halved its policy rate from 4% to 2% in the space of just one year after taming a surge in prices that followed the end of the COVID-19 pandemic and Russia's invasion of Ukraine.

With inflation now back at its 2% goal and expected to stay there, euro zone central bankers were likely to stay put this week and observe what kind of tariffs President Donald Trump's U.S. administration would impose on the European Union after an August 1 deadline for talks.

"The ECB is widely expected to keep policy on hold this week, as uncertainty prevails with no trade deal yet on the horizon between the U.S. and EU," Christophe Boucher, chief investment officer at ABN AMRO Investment Solutions, said.

The tense and unpredictable trade talks between Washington and Brussels have made policy-making difficult.

Trump's threat to impose a 30% duty on EU goods exported to the United States - a steeper tariff than the ECB had anticipated under even the most negative of three scenarios it released last month - has forced President Christine Lagarde and her colleagues on the ECB's Governing Council to contemplate lower outcomes for growth and inflation.

However, two diplomats said on Wednesday the EU and the U.S. were heading towards a deal that would result in a broad tariff of 15% applying to EU goods.

"Even in the case of a benign outcome (i.e. U.S. tariffs around 10%) we still see scope for further easing as the disinflation process broadens," MUFG's Europe economist Henry Cook said.

Investors generally expect one more ECB rate cut by the end of the year, most likely in December.

Among the deals that have been struck so far and could serve as a template for the EU, Japan negotiated a 15% tariff rate, Indonesia 20% and Britain, which runs a trade deficit with the United States, 10%.

"The key point is that tariffs look likely to be higher and more varied across countries than the 10% flat baseline that many had assumed would be the end-point of tariff negotiations," BNP Paribas's head of developed markets economics Paul Hollingsworth said.

The ECB assumes that U.S. tariffs will push down growth and, if there is no EU retaliation, inflation over the medium term.

The euro zone economy is already barely growing and companies, while still optimistic about an upturn ahead, are starting to feel the pinch from tariffs on their profits.

"The risks are still weighted towards weaker growth outcomes for Europe," economists at Deutsche Bank wrote. "This in turn points to disinflationary risk, particularly if a trade shock were to become a labour market shock."

On the other hand, banks have seen rising loan demand and policy uncertainty has not yet translated into an economic or market downturn.

After a short-lived selloff in April investors have taken the trade turmoil in their stride, with European equity indices close to new highs also thanks to Germany's newly found appetite for spending.

In fact, erratic policy-making in the United States, including Trump's relentless criticism of the Federal Reserve, has lured foreign investors to euro zone assets, briefly pushing the euro to the highest level against the dollar since September 2021 at $1.1829 earlier this month.

ECB board member and outspoken hawk Isabel Schnabel even said the central bank should watch out for price hikes caused by tariffs and the bar for further cuts was "very high".

But the euro's appreciation has unnerved other policymakers, who fear a stronger currency would make European exports less competitive and contribute to pushing down inflation.

"On that front, we would expect Christine Lagarde to strike a reassuring tone, reminding people that the ECB does not target exchange rates but that any resulting downward pressure on inflation will be addressed, if necessary," Julien Lafargue, chief market strategist at Barclays Private Bank, said.

Source: Reuters

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Manuel

Economic

Central Bank

U.S. Treasury Secretary Scott Bessent on Wednesday suggested without evidence that the Federal Reserve's widely followed economic forecasts are motivated by politics, as the Trump administration steps up pressure on the U.S. central bank to cut interest rates.

"The Fed publishes something called a summary of economic projections, and it's pretty politically biased," Bessent said, summarizing the projections as forecasts for one to two quarter-point interest-rate cuts this year. President Donald Trump has demanded the Fed deliver an immediate 300 basis-point rate cut.

The Fed publishes interest-rate forecasts from each of its 19 policymakers each quarter and does not identify which policymaker made which forecast. In June, eight projected two quarter-point interest-rate cuts this year, seven projected none, two saw one interest rate cut and two saw three.

Two of the Fed Board's Trump appointees - Governor Christopher Waller and Fed Vice Chair for Supervision Michelle Bowman — have each articulated economic reasons for supporting a rate cut this month. Fed Chair Jerome Powell, also a Trump appointee, has not signaled such support.

Fed policymakers universally reject the idea that politics have any role in their monetary policy decisions, and say that to suggest they do undermines the central bank's credibility and its ability to do its job fighting inflation and promoting maximum employment.

Source: Reuters

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Manuel

Cryptocurrency

Solana-based tokenized stocks surpassed $100 million in market capitalization less than one month since their official launch on June 30.

According to rwa.xyz data, the tokenized stock market on Solana is valued at nearly $102 million as of July 22, representing a 242% increase from its $29.8 million size at the debut date. This market is fueled mainly by xStocks, issued by Backed Finance.

As a result, Solana now accounts for 20.4% of the tokenized stock market. Notably, Ethereum and its layer-2 blockchains Arbitrum, Polygon, and Base account for $11.8 million, which makes Solana’s tokenized stock market over eight times larger.

The largest tokenized stock is TSLAx, representing Tesla’s shares, with a market capitalization of $13.6 million and 11,073 holders.

Tokenized S&P 500 are also in the tens of millions, with SPYx showing a market capitalization of just over $10 million and 9,886 holders.

The tokenized shares of Circle trail closely, with CRCLx reaching a $9.1 million market cap, distributed among 5,746 holders.

Furthermore, the official xStocks profile on X shared that the tokens have surpassed $300 million in on-chain trading volume.

Assessing composability

Despite the explosive growth of tokenized assets issued on Solana, xStocks investors are not interacting with DeFi protocols that have made these assets composable.

Solana-based money market Kamino offers support for eight xStocks tokens as collateral: TSLAx, SPYx, Nvidia’s NVDAx, Robinhood’s HOODx, Strategy’s MSTRx, Apple’s AAPLx, Nasdaq’s QQQx, and Alphabet’s GOOGLx.

Although their collective market cap stands at nearly $50 million, only $585,000, roughly 11%, has been used as collateral so far.

The numbers fare slightly better when it comes to liquidating providing. On Raydium’s pools, the largest TSLAx pool has $1.1 million in liquidity, of which $423,600 represents the amount of tokenized stock deposited per GeckoTerminal data.

The SPYx with most liquidity also displays a significant amount of $1.9 million in liquidity, with $502,000 worth of tokenized stocks on it.

Nevertheless, the ratio remains short. The roughly $637,000 worth of TSLAx tokens used on DeFi is just 4.7% of its market cap. For SPYx, the ratio is 7%.

Crypto to traditional, not the other way around

The relatively low usage of tokenized stocks on DeFi applications occurs mainly because money is mostly flowing from crypto to traditional products, rather than the other way around.

Michael Cahill, CEO and co-founder of Douro Labs, explained in an interview with CryptoSlate that holders from the traditional market who are entering the crypto space are not yet ready to utilize DeFi composability.

He used the Apollo Diversified Credit Securitized Fund (ACRED), launched by Pyth and created by Apollo Global Management and Securitize, as an example to illustrate that the issue of wasted composability still affects the entire tokenization industry.

ACRED has over $100 million in net asset value, yet its on-chain lending pool represents only a small fraction of this value.

However, Cahill also said he sees growth potential. He added: “But it’s just getting started. We didn’t have xStocks last year. The last time we saw anyone making a meaningful attempt at stocks was Mmirror back in the Terra days, and it wasn’t even that big either. It’s taken a really long time for people to get comfortable with this, but I think that that’ll start very gradually and then people will get a little bit more and more comfortable.”

Furthermore, he believes a Strategy-style “big company moment” could help, but thinks the real catalyst will be the product experience with a traditional finance interface for on-chain products.

Cahill concluded: “When you get one of those barriers to fall, then you can start to really see it grow together and explode way faster than that whole ramp-up we had with Strategy. It could happen very, very quickly in my mind.”

Source: Cryptoslate

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Manuel

Commodity

Political

Oil held steady as equities headed toward all-time highs on news of potential progress in trade talks between the US and the European Union, offsetting nascent signs of a softening physical market.

West Texas Intermediate crude settled little changed above $65 a barrel, recovering from its lows of the day as risk assets rallied on reports the EU and the US are closing in on a deal that would impose 15% tariffs on European imports, similar to the agreement struck with Japan.

Futures fell earlier in the session after the US Energy Information Administration reported that inventory levels at Cushing, Oklahoma, the delivery point for WTI futures, rose to the highest since June. Distillate reserves increased for a second straight week. Still, overall crude inventories fell, and diesel stockpiles remain at the lowest seasonal level since 1996, lending support to oil markets.

“Cushing is perhaps the most important takeaway, with more builds expected in the weeks ahead to carry it away from historic lows,” said Matt Smith, Americas lead oil analyst at market intelligence firm Kpler.

The stockpile data provided a downside catalyst to prices that had been drifting aimlessly amid mixed trade developments. While President Donald Trump unveiled deals with Japan and the Philippines, the European Union plans to quickly hit the US with 30% tariffs on billions of dollars worth of goods if no agreement is reached.

US Treasury Secretary Scott Bessent said he’ll discuss a potential extension of the trade truce with China during talks in Stockholm next week. The discussions can now take on a broader array of topics, potentially including Beijing’s continued purchases of “sanctioned” oil from Russia and Iran, he said.

Crude has traded in a relatively narrow range this month after a volatile June, when prices were jolted by the conflict between Israel and Iran. US crude is still down about 10% this year on concerns Trump’s tariff war will stifle consumption as OPEC+ brings back production.

Source: Bloomberg

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Manuel

Economic

Stocks

U.S. automakers are concerned about President Donald Trump's agreement to tariff Japanese vehiclesat 15%, saying they will face steeper import taxes on steel, aluminum and parts than their competitors.

“We need to review all the details of the agreement, but this is a deal that will charge lower tariffs on Japanese autos with no U.S. content,” said Matt Blunt, president of the American Automotive Policy Council, which represents the Big 3 American automakers, General Motors (GM), Ford (FORD) and Jeep-maker Stellantis (STLA).

Blunt said in an interview the U.S. companies and workers “definitely are at a disadvantage” because they face a 50% tariff on steel and aluminum and a 25% tariff on parts and finished vehicles, with some exceptions for products covered under the United States-Mexico-Canada Agreement that went into effect in 2020.

The domestic automaker reaction reveals the challenge of enforcing policies across the world economy, showing that for all of Trump’s promises there can be genuine tradeoffs from policy choices that risk serious blowback in politically important states such as Michigan and Wisconsin, where automaking is both a source of income and of identity.

Trump portrayed the trade framework as a major win after announcing it on Tuesday, saying it would add hundreds of thousands of jobs to the U.S. economy and open the Japanese economy in ways that could close a persistent trade imbalance. The agreement includes a 15% tariff that replaces the 25% import tax the Republican president had threatened to charge starting on Aug. 1. Japan would also put together $550 billion to invest in U.S. projects, the White House said.

The framework with Japan will remove regulations that prevent American vehicles from being sold in that country, the White House has said, adding that it would be possible for vehicles built in Detroit to be shipped directly to Japan and ready to be sold.

But Blunt said that foreign auto producers, including the U.S., Europe and South Korea, have just a 6% share in Japan, raising skepticism that simply having the open market that the Trump administration says will exist in that country will be sufficient.

“Tough nut to crack, and I’d be very surprised if we see any meaningful market penetration in Japan,” Blunt said.

Major Japanese automakers Toyota, Honda and Nissan did not immediately respond to a request for comment on the trade framework, nor did Autos Drive America or the Alliance for Automotive Innovation, organizations that also represent the industry.

There is the possibility that the Japanese framework would give automakers and other countries grounds for pushing for changes in the Trump administration's tariffs regime. The president has previously said that flexibility in import tax negotiations is something he values. The USMCA is up for review next year.

Ford, GM and Stellantis do “have every right to be upset,” said Sam Fiorani, vice president at consultancy AutoForecast Solutions. But “Honda, Toyota, and Nissan still import vehicles from Mexico and Canada, where the current levels of tariffs can be higher than those applied to Japanese imports. Most of the high-volume models from Japanese brands are already produced in North America.”

Fiorani noted that among the few exceptions are the Toyota 4Runner, the Mazda CX-5 and the Subaru Forester, but most of the other imports fill niches that are too small to warrant production in the U.S.

“There will be negotiations between the U.S. and Canada and Mexico, and it will probably result in tariffs no higher than 15%,” Fiorani added, “but nobody seems to be in a hurry to negotiate around the last Trump administration’s free trade agreement.”

Source: Yahoo Finance

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Owen Li

Economic

Stocks

Wall Street's main indexes moved higher on Wednesday after a Financial Times report ed that the EU and the United States were closing in on a trade deal, similar to the agreement U.S. President Donald Trump struck with Japan.

Wall Street, already on an upward trajectory, spiked after the report said that the U.S. and the EU are nearing a deal to set 15% tariffs on all European imports.

Both sides would waive tariffs on some products, including aircraft, spirits and medical devices, the report said.

The bullish momentum followed closely on the heels of Trump's trade deal with Japan , which will slash tariffs on Japanese autos to 15% from 27.5%, with duties on other goods also dropping to 15% from 25%.

An agreement with the Philippines also followed, which yielded a modest cut in tariff rate.

At 12:20 p.m. ET, the S&P 500gained 31.08 points, or 0.49%, to 6,340.70 and the Nasdaq Compositerose 43.28 points, or 0.21%, to 20,935.97.

The Dow Jones Industrial Averageedged higher 417.80 points, or 0.93%, to 44,917.71, within striking distance of its record peak.

Wall Street's "fear gauge", the CBOE Volatility Index, dipped to its lowest level in over five months.

Earlier in the day, the European Commission was preparing to seek approval for 93 billion euros ($109 billion) in counter-tariffs on American goods just in case the talks fell through.

"The key thing is the markets have confidence that the White House is going to continue to work through these trade deals," said Larry Tentarelli, chief technical strategist for Blue Chip Daily Trend Report.

Investors are now laser-focused on earnings from the "Magnificent Seven" — a group of marquee names that has helped propel U.S. stocks to all-time highs.

EV maker Teslaand Google-parent Alphabetare set to report after the bell on Wednesday. With AI optimism running high and valuations stretched, expectations for these tech giants are sky-high, leaving little margin for disappointment.

Shares of Tesla were largely steady, while Alphabet moved 0.9% lower.

GE Vernova'sshares climbed 14.1% to an all-time high, as the power equipment maker raised its current-year revenue and free cash flow forecasts after beating Wall Street estimates for second-quarter profit.

The stock, which has gained about 91% so far this year, boosted the S&P's industrials indexfor the day, up 1.6%.

Medical equipment maker Thermo Fishersurged 11.8% after beating Wall Street's estimates for second-quarter profit and revenue.

Of the 117 companies in the S&P 500 that have reported earnings to date, 84.6% have reported above analysts' expectations, as per data compiled by LSEG I/B/E/S.

On the downside, Texas Instrumentstumbled 12.1% after its quarterly profit forecast failed to impress investors, pointing to weaker-than-expected demand for its analog chips from some customers and underscored tariff-related uncertainty.

The earnings also weighed on its peer analog chipmakers, with NXP Semiconductors, Analog Devicesand ON Semiconductorfalling between 2.7% and 6.7%.

In economic data, U.S. existing home sales fell more than expected in June. Focus now shifts to Thursday's weekly jobless claims numbers and S&P Global's flash PMI data to gauge economic health in the wake of tariff uncertainties.

Following a mixed set of economic data last week, traders have ruled out an interest rate cut by the Federal Reserve next week. Odds for a September reduction stand at about 58%, according to the CME FedWatch tool.

Advancing issues outnumbered decliners by a 1.97-to-1 ratio on the NYSE and by a 1.91-to-1 ratio on the Nasdaq.

The S&P 500 posted 43 new 52-week highs and two new lows, while the Nasdaq Composite recorded 80 new highs and 16 new lows.