US launches trade 'preemptive strike': One tariff for all, one deadline for all barriers

Some economists say Mr Trump’s tariff strategy may be designed to reduce uncertainty and pave the way for trade negotiations, rather than simply stoking global tensions as previously feared. A scenario of keeping tariffs lower and extending them for 12 months is seen as a “double win” for both the US and its partners.

Rather than simply reacting, Donald Trump’s tariff move is seen as a calculated strategic move. According to Wall Street analysts, behind the reciprocal tariffs is a plan to reshape the global trade order in a way that gives the US an advantage.

While American businesses and consumers remain confused about what will happen next with President Donald Trump’s reciprocal tariffs, some economists see a more optimistic outlook – even a “global victory.”

Torsten Sløk, chief economist at Apollo Global Management, in a June 21 analysis with the suggestive title “Is Trump Outsmarting the rest of us on Tariffs?” outlined a counterintuitive but highly strategic scenario: Instead of imposing the high tariffs initially announced, the US could maintain tariffs at 30% on China and just 10% on the rest of the world – while giving countries 12 months to negotiate and reduce non-tariff barriers, opening their markets to US goods.

According to Sløk, the extension would help countries and US businesses gradually adapt to the new trade order – where high tariffs are a long-term reality. More importantly, it could immediately reduce uncertainty, facilitate investment, hiring and bring a positive boost to financial markets.

“This could be a win-win scenario,” Sløk said. “A 10% tariff is a level that our trading partners can live with, while the US still collects $400 billion a year in tariffs.”

Sløk’s analysis is notable not only for its plausibility but also because it comes from a man who has been warning of the negative. In April, he was the one who warned of the recession risk caused by Trump’s tariffs. Now he has shifted his view that the policy, if implemented wisely, could be a strategic lever rather than a double-edged sword.

In that context, a clearer tariff picture would provide more data for the US Federal Reserve, which has been watching cautiously for fear that tariffs could push the economy into stagflation.

There are also clear divisions within the Fed. On June 20, Governor Christopher Waller said that the Fed could completely cut interest rates as early as July based on current economic data. However, on the same day, San Francisco Fed President Mary Daly said that the fall would be a more reasonable time to cut interest rates.

Not only Mr. Sløk, some other experts also questioned the real impact of tariffs on the market. Chris Harvey - head of equity strategy at Wells Fargo Securities - commented that if the reciprocal tariff rate is kept at around 10-12%, it will not only not cause much damage but can also push the S&P 500 index to 7,007 points.

However, Mr. Harvey also warned: to maintain stability and support growth, the US still needs to make substantial progress in trade negotiations with major partners such as India, Japan and the European Union. Otherwise, all “strategic wisdom” will remain just words.

Theo 24hMoney

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