Supreme Court strikes down Trump’s reciprocal tariffs; Trump responds with 10% global tariff
The president said he has “great alternatives” and can charge even more than he was charging.
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.
The SPDR S&P 500 ETF, Invesco QQQ Trust, and iShares Russell 2000 ETF jumped in the aftermath of the court’s decision.
These funds then substantially pared gains, with the small-cap gauge giving up that bump to trade negative, before rebounding during the president’s press conference, which started around 1:20 p.m. ET.
In response, Trump said he was imposing a 10% global tariff effective immediately under Section 122 of the 1974 Trade Act. 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 that his administration is also going to pursue other investigations under sections 232 and 301 that may result in more tariffs.
“We have alternatives. Great alternatives,” Trump 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.”
Some of the trade deals negotiated during this administration will stand following this ruling, and others won’t, Trump said.
Ahead of this decision, prediction markets ascribed roughly 80% odds to the Supreme Court ruling against Trump’s levies.
(Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.)
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 the likes of steel and aluminum.
The odds of Americans receiving tariff stimulus checks before 2027 fell from roughly 35% to below 25% during Trump’s press conference.
“Refunds of billions of dollars would have significant consequences for the US Treasury. The Court says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers,” Justice Brett Kavanaugh wrote in his dissent. “But that process is likely to be a ‘mess,’ as was acknowledged at oral argument.”
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.”
