Trump reciprocal tariff blow bigger than we expected

President Donald Trump’s country-specific reciprocal tariffs turned out to be bigger than expected, with our calculations pointing to an import-weighted average tariff of 15.0%. If, as the Executive Order indicates, the 25% product-specific tariffs already applied to steel, aluminum and auto imports are extended to cover pharmaceuticals, semiconductors and lumber too, then together those will add an additional 6.2% to the effective tariff rate on all imports, raising it from 2.3% last year to around 24%, putting it at a 125-year high. In very general terms, Canada and Mexico have got off lightly, while those in Asia, particularly China and Vietnam, have been hit hard. The European Union and Japan sit somewhere in the middle.