US Court Blocks Trump’s Global Tariffs Over Legal Overreach

Ruling halts sweeping 10% tariffs on imports, casting uncertainty over UK-US trade deal

Trump Tariffs Ruled Unlawful by US Trade Court

A US federal trade court has ruled that former President Donald Trump exceeded his authority in attempting to impose broad global tariffs on foreign imports.

The three-judge panel at the Court of International Trade determined that Trump’s actions, which bypassed congressional approval, were not legally justified, despite being framed as a response to a “national emergency”.

Tariffs Sparked Market Volatility

The tariffs, introduced during Trump’s controversial “Liberation Day” announcement in April, included a 10% duty on UK imports. The announcement triggered sharp sell-offs in global stock markets and prompted numerous lawsuits from affected businesses.

The White House immediately filed a notice of appeal, paving the way for a potential Supreme Court battle.

Legal Challenge Backed by Small Businesses

The ruling stemmed from a lawsuit brought by five small import businesses, selling products such as wine and musical instruments. They argued the tariffs were crippling their operations by dramatically increasing costs.

This decision does not apply to industry-specific tariffs—such as those on cars, steel, and aluminium—which were issued under a separate legal framework.

Political Reactions: Sharp Divides

• White House response: Press Secretary Kush Desai condemned the ruling, calling it “a judicial coup” and asserting that judges should not interfere in what the administration sees as national security measures.
• Opposition response: Senator Ron Wyden, top Democrat on the Senate Finance Committee, labelled the tariffs “reckless” and said they had driven up prices, damaged supply chains, and harmed US businesses.
• Oregon’s Attorney General Dan Rayfield described the tariffs as “unlawful and economically devastating.”

Economic and Market Impact

Economists had warned the tariffs could fuel inflation and trigger a recession. The court ruling appears to have reassured investors, as:

• US dollar strengthened following the decision
• Stock market futures rallied, suggesting relief across financial markets

“The market’s reaction seems to be a reversal of earlier moves made on tariff fears,” said Ray Attrill, Head of FX Strategy at National Australia Bank.

Impact on UK-US Trade Deal Uncertain

The ruling comes just weeks after the UK and US finalised a new trade agreement that reduces tariffs on British cars from 27.5% to 10%, and removes duties on UK steel and aluminium.

It remains unclear how this verdict might affect that deal, as the court did not rule on sector-specific tariffs included in the agreement.

Key Takeaways

• Trump’s 10% global tariffs blocked by US trade court
• President acted beyond legal authority, judges ruled
• White House to appeal, raising the stakes for future trade policy
• Economic fears eased, with markets rallying post-ruling
• Implications for UK-US trade deal remain uncertain

This landmark decision could reshape US trade policy and influence future negotiations with key allies like the UK. Investors and policymakers alike will be watching closely as the appeal progresses.

Sources: (SKY.com, BBC.co.uk)