Strategists say the shift to court-tested trade law leaves investors no escape hatch this time
Investors can no longer treat US tariffs as a passing threat that negotiation will eventually clear away.
That is the message from strategists reacting to the levies of 10 to 12.5 percent that took effect Friday on 60 trading partners, and the reason is legal.
US President Donald Trump imposed the new duties under Section 301 of the Trade Act of 1974, a route the Supreme Court effectively pointed to when it struck down his earlier emergency-powers tariffs in February, according to Reuters.
The office of the US trade representative said the measures cover 99.4 percent of US imports.
Matthew Ryan, head of market strategy at Ebury, said Section 301 closes the legal gap that let the Supreme Court strike down the previous import taxes.
Markets may need to price tariffs as "a structural drag on global growth" rather than a transient risk, he told CNBC.
The fiscal maths gives Washington a reason to keep them.
Reuters reported that the earlier "liberation day" tariffs generated US$166bn in revenue before importer refunds turned those collections negative, while the 150-day temporary duties added US$31bn in assessed revenue through July 5, a sum also subject to refund if a federal court ruling against them holds.
With US public debt approaching US$40tn, future administrations may grow reliant on the income, said Josh Lipsky, chair of international economics at the Atlantic Council.
"The tariff wall is being rebuilt strong brick by strong brick, and it's very durable," Lipsky told Reuters.
Markets barely flinched on Friday, CNBC reported, because investors had anticipated the move as the previous duties neared expiry, in contrast to the sell-off that greeted the April 2025 levies.
What has changed, strategists say, is the backdrop.
The tariffs arrive alongside a global energy shock, with oil back above US$100 a barrel as the war between the US and Iran runs into a sixth month.
Emma Moriarty, a portfolio manager at CG Asset Management, said the administration appears content to add levies even when they strain domestic markets.
"For markets, the implications should be clear: we have to position for a low growth and high inflation outcome," Moriarty said.
That outlook now runs through the US Federal Reserve.
Attention turns to this week's policy meeting, CNBC reported, with the climb in oil prices raising the prospect of a rate hike later this year.
According to Ryan, that marks a shift from earlier expectations that policymakers would hold through year-end before cutting in 2027.
The pressure lands on an economy that has stalled in the areas Trump promised to lift, Reuters reported in a review of his first 18 months back in office.
Inflation remains above the Fed's 2 percent target, with progress on the most closely watched price gauges stalling, and disposable personal income adjusted for inflation has flattened and recently declined even as consumer spending holds up.
Equities have done well without standing out: the S&P 500 has gained roughly 25 percent during the term, Reuters said, near the middle of the pack for presidencies dating back to 1981.
For institutional allocators, the sharper signal sits in credit.
Corporate bond issuance reached US$1.52tn in the first half of the year through the end of June, a record pace and a large share of it financing the buildout of artificial intelligence data centres, according to Reuters.
Tight spreads and firm demand alongside that supply point to solid corporate balance sheets, though the concentration of new debt around a single theme adds a fresh variable for markets already weighing tariffs, oil, and rates.
More trade action is coming.
According to Reuters, Greer's office is wrapping up a separate Section 301 probe into excess industrial capacity across 16 major trading partners, among them China, the European Union, Japan, South Korea, Mexico, and Vietnam.
Other investigations cover alleged intellectual property theft and national security protections spanning semiconductors to robotics.
"We're at the end of the beginning of the Trump tariff agenda," said Dan Ujczo, associate general counsel at Cenovus Energy, who specializes in US-Canada trade.
