WASHINGTON/OTTAWA, April04: if US markets pass on complete tariff enforced by Trump Administration then the high-end iPhone would then cost $2300, which is way higher than now. This has started a new debate inside US markets.
According to projections by Rosenblatt Securities, a high-end iPhone could see its price surge to nearly $2,300 if Apple decides to pass on the additional costs to consumers.
In response to the tariffs, several multinational corporations have begun adjusting their operations.
Stellantis has announced temporary layoffs for U.S. workers and the closure of plants in Canada and Mexico, while General Motors has signaled an increase in domestic production.
Nations worldwide have reacted strongly against the United States following President Donald Trump’s newly imposed tariffs, heightening concerns over an escalating trade war that could lead to significant price hikes in the American market.
The trade measures, unveiled on Wednesday, sent shockwaves through global financial markets and prompted widespread condemnation from world leaders, marking a stark departure from decades of trade liberalization.
However, the White House offered mixed signals regarding the permanence of these tariffs, with Trump himself suggesting they could serve as leverage in trade negotiations.
Highest Ever Trade Barriers
The new tariff structure introduces the highest trade barriers in over a century, imposing a baseline 10% tariff on all imports, with steeper rates on goods from major trading partners.
Analysts warn this could lead to higher costs for American consumers, impacting a vast array of products ranging from electronics and footwear to automobiles and consumer goods.
Canadian Prime Minister Mark Carney criticized the move, stating that the U.S. had relinquished its long-standing leadership role in global economic cooperation.
“The landscape of the global economy has fundamentally shifted overnight,” Carney remarked while outlining Canada’s limited retaliatory measures.
Meanwhile, China has vowed countermeasures in response to the 54% tariffs imposed on its exports to the U.S. The European Union, facing a 20% tariff, has also indicated plans for retaliation.
French President Emmanuel Macron has urged European nations to halt investments in the United States as a means of economic pushback.
Read More: US Tariffs Reach Historic Highs, Smaller Nations Face Steeper Rates
Other key trading partners, including South Korea, Mexico, and India, have signaled a cautious approach, opting to pursue negotiations before implementing retaliatory tariffs.
Washington’s actions have drawn severe warnings from global economic bodies.
The International Monetary Fund (IMF) expressed deep concern, with Managing Director Kristalina Georgieva cautioning that the tariffs present a substantial risk to the already fragile global economic outlook.
“These measures could significantly harm global trade and economic stability,” Georgieva emphasized, urging the U.S. and its trade partners to engage in constructive dialogue.
While senior Trump administration officials, including Commerce Secretary Howard Lutnick and trade adviser Peter Navarro, have insisted that the tariffs are here to stay, Trump later appeared to contradict this stance, stating that they offer a powerful tool for negotiation.
“Tariffs provide us with tremendous leverage. We’ve used them effectively before, and now we’re taking it to a whole new level,” the president asserted.
Financial Markets Plunge
Financial markets reacted sharply to the announcement, with stocks experiencing a global downturn. The Dow Jones Industrial Average suffered a nearly 4% drop—its worst single-day decline since June 2020.
The S&P 500 plummeted nearly 5%, while the Nasdaq recorded a staggering 6% loss, marking its steepest decline since the pandemic-related market crash of March 2020.
Major American companies reliant on overseas production bore the brunt of the market turmoil. Shares of Nike plunged by 14%, while Apple saw a 9% drop in its stock value.
Also Read: Negligible Direct Impact on Pakistan: Trump Tariffs Determination
Trump has justified the tariffs as a means to counter restrictive trade policies imposed on American goods, arguing that the move will rejuvenate domestic manufacturing and enhance export opportunities.
However, administration officials acknowledge that tangible economic benefits may take time to materialize.
Vice President JD Vance defended the policy in a Newsmax interview, emphasizing its long-term benefits.
“This isn’t just about trade; it’s about national security and ensuring self-sufficiency in critical industries like steel and pharmaceuticals,” Vance stated.
Since Trump’s return to the White House in January, his tariff threats have created uncertainty among businesses and consumers alike.
Taking Effect from April 09
While the reciprocal tariffs are slated to take effect on April 9, the administration has left open the possibility of modifications.
Trade experts remain skeptical of the strategy’s effectiveness. James Lucier, a founding partner at Capital Alpha, critiqued the tariff plan as lacking strategic coherence.
“Trade negotiations require a nuanced approach. These proposals seem more like political posturing than a well-thought-out economic policy,” Lucier observed.
Economists warn that the tariffs could fuel inflation, heighten the risk of a U.S. recession, and burden American households with additional costs amounting to thousands of dollars annually.
Furthermore, analysts caution that the aggressive tariff policy may strain alliances in Asia and hinder U.S. efforts to counterbalance China’s influence.
Also Read: What Risks Agri Sector as US Imposes Tariff on Pakistan
Key allies such as Japan and South Korea, both hosting significant U.S. military bases, have been hit with tariffs of 24% and 25%, respectively. Taiwan, already facing mounting military pressure from China, has been targeted with a 32% tariff.
While Canada and Mexico were spared targeted tariffs in the latest announcement, both countries are still subject to preexisting 25% tariffs on numerous goods, along with additional tariffs on auto imports.
As tensions escalate, the global economic landscape faces heightened uncertainty, with major economies weighing their next steps in response to Washington’s protectionist policies.
