Supreme Court strikes down Trump’s reciprocal tariffs; Trump responds with new global tariff

After the Supreme Court struck down a large portion of President Donald Trump’s tariff regime, the president acted quickly to reimpose levies on cross-border commerce. Shortly after, Trump said he was imposing a 10% global tariff under Section 122 of the 1974 Trade Act, which he increased to 15% on Saturday.

These particular duties can remain in place for 150 days, after which time congressional approval would be required.

Per the president, these Section 122 levies will be in addition to Section 232 and 301 tariffs that remain in effect, and his administration is also going to pursue other investigations under sections 232 and 301 that may result in more tariffs. Some of the trade deals negotiated during this administration will stand following this ruling, and others won’t, Trump said.

“We have alternatives. Great alternatives,” he said, suggesting that even more tariff revenue would be raised through these different means. He added, “I can charge much more than I was charging.”

Ahead of this decision, prediction markets* ascribed roughly 80% odds to the Supreme Court ruling against Trump’s levies.

The ruling impacted tariffs imposed by way of the International Emergency Economic Powers Act, which includes the reciprocal tariffs announced on April 2’s so-called “Liberation Day.” Bloomberg Intelligence estimates that roughly $170 billion in tariff revenues have been generated through February 20 via these policies. As mentioned, this ruling has no bearing on the tariffs instituted under Section 232, which has been used to justify levies on items from automobiles to aluminum.

The Takeaway

Samuel Rines, macro strategist at WisdomTree, previously warned that the court’s decision “doesn’t really matter for the overall tariff picture. It only changes the legal mechanisms that will be used. In fact, it takes something that companies / markets had largely dealt with and moved on from and brings them back into the narrative.”

The range of near-term discussion points for markets now includes everything from “battles to get refunds for tariffs already paid” to “whether effective tariff rates will actually go down as the administration pursues alternative measures.”