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The on-again, off-again tariffs between the United States and other countries are again under scrutiny, with the U.S. president not budging. VOA White House Correspondent Carolyn Presutti reports.
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NEW YORK — Wall Street’s sell-off hit a new low Thursday after U.S. President Donald Trump’s escalating trade war dragged the S&P 500 more than 10% below its record, which was set just last month.
A 10% drop is deemed a correction by professional investors, and the S&P 500’s 1.4% slide on Thursday sent the index to its first since 2023. The losses came after Trump upped the stakes in his trade war by threatening huge taxes on European wines and alcohol. Not even a double-shot of good news on the U.S. economy could stop the bleeding.
The Dow Jones Industrial Average dropped 537 points, or 1.3% Thursday, and the Nasdaq composite fell 2%.
The dizzying, battering swings for stocks have been coming not just day to day but also hour to hour, and the Dow hurtled between a slight gain and a drop of 689 points through Thursday’s trading.
The turbulence is a result of uncertainty about how much pain Trump will let the economy endure through tariffs and other policies to reshape the country and world as he wants. The president has said he wants manufacturing jobs back in the United States, along with a smaller U.S. government workforce and other fundamental changes.
Trump’s latest escalation came Thursday when he threatened 200% tariffs on Champagne and other European wines, unless the European Union rolls back a tariff it announced on U.S. whiskey. The European Union unveiled that move on Wednesday, in response to U.S. tariffs on European steel and aluminum.
U.S. households and businesses have reported drops in confidence because of all the uncertainty about which tariffs will stick from Trump’s barrage of on-again, off-again announcements. That’s raised fears about a pullback in spending that could sap energy from the economy. Some U.S. businesses say they’ve begun to see a change in their customers’ behavior because of the uncertainty.
A particularly feared scenario for the economy is one where its growth stagnates but inflation stays high because of tariffs. Few tools are available in Washington to fix what’s called stagflation.
There was good news Thursday, and it came on both those economic fronts.
One report showed inflation at the wholesale level last month was milder than economists expected. It followed a similarly encouraging report from the prior day on inflation that U.S. consumers are feeling.
A separate report, meanwhile, said fewer U.S. workers applied for unemployment benefits last week than economists expected. It’s the latest signal that the job market remains relatively solid overall. If that can continue, it could allow U.S. consumers to keep spending, and that’s the main engine of the economy.
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BEIJING — China has been “doing its best” to push for negotiations with the European Union over its tariffs on Chinese-made electric vehicles, a commerce ministry spokesperson said on Thursday, almost four months after the punitive import curbs took effect.

The bloc voted to increase the tariffs to as much as 45.3% in October after the European Commission — which oversees EU trade policy — launched an anti-subsidy probe into whether Chinese firms benefited from preferential grants and financing as well as land, batteries and raw materials at below market prices.

“China has been doing its best to push for negotiations with the EU,” He Yadong said. “It is hoped that the EU will take notice of the call from industry and promote bilateral investment cooperation through dialogue and consultation.”

China launched its own probes last year into imports of EU brandy, dairy and pork products.

He told reporters China’s anti-dumping probe into Europe’s pork products and anti-subsidy investigation into the 27-strong bloc’s dairy trade were still ongoing, when asked how the cases were progressing.

“We will conduct the investigation in an open and transparent manner in accordance with Chinese laws and regulations and World Trade Organization rules,” he added. China’s commerce ministry in December decided to extend its anti-dumping investigation into EU brandy imports by three months to April 5.
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NAIROBI, KENYA — Milk and egg vendor Caroline Mukundi has lost a lot of her stock in her years of selling fresh food at a Nairobi market.

Mukundi said she had no way to keep food fresh, and the cost of refrigerating was out of reach.

“The food would go bad,” she said, and she would have to throw it away. “It was a big challenge for me.”

Mukundi said her situation turned around when she acquired a solar-powered refrigerator.

The refrigerators, named Koolboks and manufactured in Kenya, are fitted with ice compartments that can chill food even without a source of power. The devices can keep food cool for up to four days without electricity, even with limited sunlight.

Customers can buy the refrigerators on a customized payment model, said Natalie Casey, chief business officer at the Koolboks startup company.

“They can be between 1,500 and 3,000 US dollars, because it includes not only the appliances but also the solar panels and battery storage to enable the continuous cooling,” she said. “We’ve decided what might be more accessible to them is to first pay a down payment between 20 and 35% of the total, and the customer can pay in installments of up to 24 months.”

Koolboks has sold about 7,000 solar-powered refrigerators.

Conventional refrigerators for businesses can cost anywhere from $11,000 to $100,000 or more, said Dorothy Otieno, program manager at the Center for Environmental Justice and Development.

“Some businesses, especially small businesses, are not able to afford it,” she said.

“We are looking at, for example, how businesses can be supported to get access to [the Koolboks refrigerators], especially for communities that are not able to afford,” she said.

The refrigerator was among dozens of innovations showcased at the recent Africa Tech Summit in Nairobi. The conference’s founder, Andrew Fassnidge, told VOA that such creations are crucial to solving local problems on the continent.

“What’s interesting with … Koolboks refrigeration is, if we look at the Covid vaccine, one of the biggest issues at the time was refrigeration, and it’s still an issue in most markets,” he said.

Koolboks markets a refrigerator specifically for vaccines.

The refrigerators could have an impact on climate change, too.

A 2024 survey by the U.N. Environmental Program showed Kenya has a high level of food waste, with annual waste ranging from 40 to 100 kilograms per person.

Environmentalists say high levels of organic waste worsen climate change, so preventing food waste can have an impact.
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Tokyo — Global shares traded mixed on Monday as investors continued to watch economic data and policy moves from U.S. President Donald Trump, as both are likely to impact upcoming central bank moves.

France’s CAC 40 dipped nearly 0.1% in early trading to 8,171.59, while Germany’s DAX added 0.4% to 22,560.00. Britain’s FTSE 100 edged up 0.1% to 8,742.97.

U.S. markets are closed on Monday for a holiday.

In Asia, Japan’s benchmark Nikkei 225 rose in early trading after the Cabinet Office reported that the economy grew at a better-than-expected annual rate of 2.8% in October-December, underlined by steady exports and moderate consumption. But the benchmark quickly fell back and then recovered to be little changed, finishing up less than 0.1% at 39,174.25.

On a quarter-to-quarter basis, the world’s fourth-largest economy grew 0.7% for its third straight quarter of growth. Japan marked its fourth straight year of expansion, eking out 0.1% growth last year in seasonally adjusted real gross domestic product, which measures the value of a nation’s products and services.

In other regional markets, Australia’s S&P/ASX 200 slipped 0.2% to 8,537.10. South Korea’s Kospi surged 0.8% to 2,610.42. Hong Kong’s Hang Seng reversed course, to slip less than 0.1% to 22,616.23, while the Shanghai Composite added 0.3% to 3,355.83.

Markets around the world are nervously watching what upward pressure may come from tariffs that Trump has announced recently. But analysts now think Trump may ultimately avoid triggering a punishing global trade war.

His most recent tariff announcement, for example, won’t take full effect for at least several weeks. That leaves time for Washington and other countries to negotiate.

The Federal Reserve’s goal, as well as that of the Bank of Japan, is to keep inflation at 2%.

In energy trading, benchmark U.S. crude added 28 cents to $71.02 a barrel. Brent crude, the international standard, rose 34 cents to $75.08 a barrel.

In currency trading, the U.S. dollar declined to 151.90 Japanese yen from 152.25 yen. The euro cost $1.0472, down from $1.0495.
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It’s a chicken-and-egg problem: Restaurants are struggling with record-high U.S. egg prices, but their omelets, scrambles and huevos rancheros may be part of the problem.

Breakfast is booming at U.S. eateries. First Watch, a restaurant chain that serves breakfast, brunch and lunch, nearly quadrupled its locations over the past decade to 570. Eggs Up Grill has 90 restaurants in nine southern states, up from 26 in 2018. Florida-based Another Broken Egg Café celebrated its 100th restaurant last year.

Fast-food chains are also adding more breakfast items. Starbucks, which launched egg bites in 2017, now has a breakfast menu with 12 separate items containing eggs. Wendy’s reintroduced breakfast in 2020 and offers 10 items with eggs.

Reviews website Yelp said 6,421 breakfast and brunch businesses opened in the United States last year, 23% more than in 2019.

In normal times, producers could meet the demand for all those eggs. But an ongoing bird flu outbreak, which so far has forced farms to slaughter nearly 159 million chickens, turkeys and other birds — including nearly 47 million since the start of December — is making supplies scarcer and pushing up prices. In January, the average price of eggs in the U.S. hit a record $4.95 per dozen.

The percentage of eggs that go to U.S. restaurants versus other places, like grocery stores or food manufacturers, is not publicly available. U.S. Foods, a restaurant supplier, and Cal-Maine Foods, the largest U.S. producer of shell eggs, did not respond to The Associated Press’ requests for comment.

But demand from restaurants is almost certainly growing. Foot traffic at U.S. restaurants has grown the most since 2019 for morning meals, 2019, according to market research firm Circana. Pre-lunchtime hours accounted for 21% of total restaurant visits in 2024.

Breakfast sandwiches are the most popular order during morning visits, Circana said, and 70% of the breakfast sandwiches on U.S. menus include eggs.

Eggs Up Grill CEO Ricky Richardson said breakfast restaurants took off after the COVID pandemic because people longed for comfort and connection. As inflation made food more expensive, customers saw breakfast and lunch as more affordable options for eating out, he said.

The growth in restaurant demand reverses a pattern that emerged during the pandemic, when consumers tried to stock up on eggs for home use but restaurants needed fewer of them because many of them had to close for a time, according to Brian Earnest, a lead economist for animal proteins at CoBank.

U.S. egg consumption declined for more than five decades before reaching a low of 247 per person in 2008, according to data from the U.S. Department of Agriculture. As nutritional research and marketing established eggs as an inexpensive protein source instead of heart-clogging cholesterol bombs, per capita consumption of egg products grew to the equivalent of 292 fresh eggs in 2019, the data shows.

“Consumers think eggs are really fresh, so if you’re making something with eggs, you know it’s fresh,” Earnest said.

Before the pandemic reduced demand and bird flu outbreaks impacted supplies, the USDA had forecast that Americans would continue eating more eggs. By 2023, the most recent year for which annual data is available, they were down to 249 eggs per person.

Other trends have impacted the economics of eggs. To address animal rights concerns, McDonald’s and some other companies have switched to 100% cage-free eggs, which limits the sources they will buy from. Ten states, including California and Colorado, have passed laws restricting egg sales to products from cage-free environments.

“It makes the market much more complicated than it was 20 years ago,” Earnest said.

The higher prices are hitting restaurants hard. Wholesale egg prices hit a national average of $7.34 per dozen last week, according to the U.S. Department of Agriculture. That was 51% higher than at the beginning of the year. Wholesale costs may be higher than retail prices since grocers use eggs as a loss leader to get customers in the door.

Some chains, like Waffle House, have added a surcharge to help offset the cost of eggs. Others may turn to egg substitutes like tapioca starch for some recipes or cut egg dishes from the menu, said Phil Kafarakis, the president and CEO of the International Foodservice Manufacturers Association.

First Watch President and CEO Chris Tomasso said eggs are critical for the chain’s brand and are found in the majority of its offerings, whether at the center of the plate or as an ingredient in batters. So far, he said, the company has been able to obtain the eggs it needs and isn’t charging extra for them.

First Watch is also increasing portion sizes for non-egg items like meat and potatoes, Tomasso said.

Richardson, of Eggs Up Grill, said he recently met with franchisees to discuss adding a surcharge but they decided against it.

“Eggs have always been and will continue to be an important part of American diets,” Richardson said.
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London — China’s demand for road and air transport fuels may have passed its peak, the International Energy Agency (IEA) said Thursday, citing data showing that the country’s consumption of gasoline, gasoil and jet fuel declined marginally in 2024. 

Combined consumption of the three fuels in China last year was at 8.1 million barrels per day (bpd), which was 200,000 bpd lower than in 2021 and only narrowly above 2019 levels, the IEA said in a monthly report. 

“This strongly suggests that fuel use in the country has already reached a plateau and may even have passed its peak,” it said. 

After decades of leading global oil demand growth, China’s contribution is sputtering as it faces economic challenges as well as making a shift to electric vehicles (EVs). 

The decline in China’s fuel demand is likely to accelerate over the medium term, which would be enough to generate a plateau in total China oil demand this decade, according to the Paris-based IEA. 

“This remarkable slowdown in consumption growth has been achieved by a combination of structural changes in China’s economy and the rapid deployment of alternative transportation technologies,” the IEA said. 

A slump in China’s construction sector and weaker consumer spending reduced fuel demand in the country, it said, adding that uptake of EVs also weighed.  

New EVs currently account for half of car sales and undercut around 250,000-300,000 bpd of oil demand growth in 2024, while use of compressed and liquified natural gas in road freight displaced around 150,000 bpd, it said. 
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HARARE, ZIMBABWE — Zimbabwe’s government said Wednesday it will compensate foreign investors who lost assets in the country’s controversial land reforms in the early 2000s but were protected by bilateral investment protection agreements.

Zimbabwean Finance Minister Mthuli Ncube said in a statement the government will pay 94 former farmers from countries such as Switzerland, Denmark, Germany, Netherlands and the former Yugoslavia.

The farmers are covered under Bilateral Investment Protection and Promotion Agreements, or BIPPAs, that Zimbabwe signed with the farmers’ countries.

Ncube said $20 million is being paid out of the 2024 budget and another $20 million would come from the 2025 budget.

“This is a very important issue for our arrears clearance and debt resolution process for Zimbabwe, because some of the countries for which we want support, their farmers, their investors, into Zimbabwe were affected by the land reform program in the early 2000s,” Ncube said. “But we’re only targeting those countries where the BIPPAs were ratified properly.”

The aim, he said, is to have cleared the entire $146 million liability for BIPPA farmers by the end of 2028.

“We believe that this is very important for building trust, for honoring our commitments,” he said.

Zimbabwe’s government is aiming to rebuild its financial reputation after requesting debt relief and restructuring from international financial institutions and other countries in 2022.

According to the African Development Bank, Zimbabwe’s total foreign debt is $21 billion — including interest — which it has been failing to service for years.

However, Eddie Mahembe, an independent economist based in Harare, says resettled farmers, not the government, should pay the $146 million, to prevent increasing the country’s debt.

“Why is the government paying for the farms which were allocated to individuals?” Mahembe said. “They are farming. Some are doing tobacco. They’ve been selling their tobacco over the years, and we are seeing … that there is now a move toward giving them title deals. Why is the government assuming that debt?”

Others are concerned that Harare is paying only former farmers of foreign origin. Displaced white Zimbabwean farmers want to be compensated as well, as per a 2020 agreement.

That agreement called for Harare to pay $3.5 billion to the farmers driven off their land under a program backed by then-President Robert Mugabe starting in 2000.

Trevor Gifford, former head of Zimbabwe’s Commercial Farmers Union, said, “Twenty-five years from the start of land reform in Zimbabwe, the majority of displaced title deed holders remain destitute due to the nonpayment of compensation. The government failed to honor its commitment on paying [on time] under the global compensation agreement, which is now expired.”

He said the government’s move to give title deeds to the farmers who took over the land will create confusion and keep away foreign investors.

“The issuing of title deeds on top of existing title deeds, which have still not been paid for in terms of the international norms for land reform, is reckless and does not create any confidence for prospective investments in Zimbabwe,” Gifford said.

Graham Rae was displaced from his farm about 100 kilometers east of Harare and is now farming in neighboring Zambia. He said that until he is compensated, he will not surrender title deeds to the land for which he was dispossessed.

“You can’t steal a car and then sell it to me and think you’ve washed your hands and now it’s a legal car,” Rae said. “It’s still illegal and by the mere fact that I’m buying a stolen car from you, I’m complicit in the theft, so there are going to be lots of problems. I find that fraudulent, I just find that very sad that Zimbabwe has regressed into a basket case where there’s no rule of law, and that the rule really is at the barrel of a gun — if you don’t agree, you disappear.”

For now, the Zimbabwe government says it will issue titles to the resettled farmers so that they can use them to borrow money for capitalization of their businesses.
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WASHINGTON — As his trade advisers finalized plans to enact reciprocal measures on every country that charges duties on U.S. imports, President Donald Trump announced Wednesday he will push for lower interest rates alongside his tariff policies.

“Interest Rates should be lowered, something which would go hand in hand with upcoming Tariffs!!! Lets Rock and Roll, America!!!” Trump said on social media Wednesday morning.

To maintain the Federal Reserves’ autonomy from politics, U.S. presidents traditionally avoid even the appearance of meddling in monetary policy and the nation’s interest rates, which is the purview of the central bank.

Trump, however, has not shied from the practice. In a videoconference address to the World Economic Forum in Davos, Switzerland, in January, Trump said he would “demand that interest rates drop immediately.”

“I know interest rates much better than they do,” he said of Fed officials. He has ramped up his criticism of Federal Reserve Chair Jerome Powell, whom he appointed in 2017 for a term that ends in 2026.

Trump’s push to lower interest rates is intended to go hand in hand with punitive measures on trading partners.

Reciprocal tariffs are “absolutely a high priority for the president,” White House economic adviser Kevin Hassett told reporters Wednesday, promising “a lot more action on it today.”

Hassett said the White House has begun negotiations with other countries early to lay the groundwork for imposing such tariffs, although he acknowledged the details about which sectors or how they will be implemented is a “work in progress.”

Under World Trade Organization rules, member countries have the right to impose tariffs on imports. Countries negotiate those rates at the WTO to determine the maximum tariff rate a member country can impose on imports from other member countries.

Inflation, looming trade war

U.S. inflation rose to 3% in January, according to government data released Wednesday. Last month, the annual pace was 2.9%.

Trump campaigned on lowering high consumer prices he blamed on his predecessor, Joe Biden. White House Press Secretary Karoline Leavitt again attributed the increase to the previous administration.

“This is an indictment on the Biden administration’s mismanagement of the inflation crisis and their lack of transparency,” she said during her briefing Wednesday.

Trump wants to lower interest rates and inflation, she said. “He believes that the whole of government economic approach that this administration is taking will result in lower inflation.”

However, some economists warn that combining high tariffs and low interest rates will have the opposite effect.

Trump’s plan reflects a “misunderstanding of how the economy works,” said Joseph Gagnon, senior fellow at the Peterson Institute for International Economics.

“Tariffs raise prices directly, that is inflationary, but also cutting interest rates is inflationary if you do it excessively,” he told VOA. “Especially with today’s data, cutting interest rates would not be a good idea.”

During testimony Tuesday before the Senate Banking Committee, Powell said the Fed was in no rush to cut interest rates because the economy had stabilized. He noted that inflation, while still above the Fed’s 2% target, was at 2.6% last year, and he said the labor market was cooling without plummeting, with the unemployment rate at 4%.

Gagnon also warned of a looming trade war. Trump already had announced Monday his decision to impose 25% tariffs on all steel and aluminum imports beginning March 12.

The duties will hit top U.S. steel supplier Canada, followed by Brazil, Mexico, South Korea and Germany. Additionally, Canada is the leader in aluminum exports to the American market.

European Union chief Ursula von der Leyen vowed on Tuesday the move “will not go unanswered,” saying it will trigger tough countermeasures from the 27-nation bloc, potentially targeting iconic American industries such as bourbon, jeans and motorcycles. EU trade ministers are meeting Wednesday to determine their next moves.

China, Mexico and Canada

Last week, Trump imposed an additional 10% tariff on Chinese goods, which the White House said was aimed at halting the flow of fentanyl opioids and their precursor chemicals.

On Monday China began slapping retaliatory actions on some American goods, including 15% duties on coal and natural gas imports and 10% on petroleum, agricultural equipment, high-emission vehicles and pickup trucks. The country also immediately implemented restrictions on the export of certain critical minerals, and it launched an antitrust investigation into American tech giant Google.

Trump delayed enacting a 25% tariff on goods from Mexico and Canada for a month — until March 4 — to allow negotiations over his demands for the U.S. neighbors to secure their borders and stop the flow of the illegal drug fentanyl.

The duties could affect about $1.323 trillion in trade imports that come from China, Mexico and Canada, according to U.S. government data. This accounts for 43% of U.S. imports and 5% of the $27 trillion U.S. gross domestic product.

If enacted, the new import taxes on Canada, Mexico and China will increase the average tariff rate from its current level of 3% to 10.7% based on contemporary trade patterns, said Joseph Brusuelas, chief economist at financial advisory firm RSM.

“Should the trade skirmishes escalate to include the European Union and turn into an all-out trade war, expect U.S. economic growth to ease back to 2% as the tariffs drag down growth and employment, stoke inflation and widen the current account deficit, all amid higher interest rates,” he wrote on RSM’s Real Economy Blog.

VOA’s Celia Mendoza contributed to this report.
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WASHINGTON — U.S. inflation accelerated last month as the cost of groceries, gas and used cars rose, a disappointment for families and businesses struggling with higher costs and likely underscoring the Federal Reserve’s resolve to delay any further interest rate cuts.

The consumer price index increased 3% in January from a year ago, Wednesday’s report from the Labor Department showed, up from 2.9% the previous month. It has increased from a 3½-year low of 2.4% in September.

The figures show that inflation has remained stubbornly above the Fed’s 2% target for roughly the past six months, after it fell steadily for about a year and a half. Elevated prices created a major political problem for former President Joe Biden. President Donald Trump pledged to reduce prices in last year’s campaign, although most economists worry that his many proposed tariffs could at least temporarily increase costs.

The unexpected boost in inflation could dampen some of the business enthusiasm that arose after Trump’s election on promises to reduce regulation and cut taxes. Dow futures tumbled 400 points, and all major markets are likely to sell off at the opening bell. Bond yields rose, a sign traders expect inflation and interest rates to remain high.

Excluding the volatile food and energy categories, core consumer prices rose 3.3% in January compared with a year ago, up from 3.2% in December. Economists closely watch core prices because they can provide a better read of inflation’s future.

Month-to-month inflation

Inflation also worsened monthly, with prices jumping 0.5% in January from December, the largest increase since August 2023. Core prices climbed 0.4% last month, the most since March 2024.

Grocery prices climbed 0.5% just in January, pushed higher by a 15.2% surge in egg prices, the biggest monthly increase since June of 2015. Egg prices have soared 53% compared with a year ago.

An avian flu epidemic has forced many egg producers to cull millions of birds from their flocks. Some stores have imposed limits on egg purchases, and some restaurants have placed surcharges on egg dishes.

The cost of car insurance continues to rise and picked up 2% just from December to January. Hotel prices rose 1.4% last month, while the cost of a gallon of gas moved up 1.8%.

Inflation often jumps in January as many companies raise their prices at the beginning of the year, although the government’s seasonal adjustment process is supposed to filter out those effects.

Later Wednesday, Federal Reserve Chair Jerome Powell will testify before the House Financial Services Committee, where he will likely be asked about inflation and the Fed’s response to it. The Fed raised its benchmark rate in 2022 and 2023 to a two-decade high of 5.3% to combat inflation. With inflation down significantly from its 9.1% peak in June 2022, it cut its rate to about 4.3% in its final three meetings last year.

Interest rates and tariffs

Early Wednesday, Trump said on social media that interest rates should be lowered, “something which would go hand in hand with upcoming Tariffs!!!” Yet the tick up in consumer prices makes it less likely the Fed will cut rates anytime soon.

Fed officials are mostly confident that inflation over time will head lower, but they want to see further evidence that it is declining before cutting their key rate any further. The Fed’s rate typically influences other borrowing costs for things such as mortgages, auto loans and credit cards.

Inflation’s recent uptick is a major reason the Federal Reserve has paused its interest rate cuts, after implementing three of them last year. “We do not need to be in a hurry” to implement further reductions, Powell said Tuesday in testimony to the Senate Banking Committee.

The Trump administration’s tariff policy could lift prices in the coming months. Trump on Monday imposed 25% taxes on steel and aluminum imports and has pledged to impose more tariffs. Economists at Goldman Sachs forecast that yearly core inflation would fall almost a full percentage point, to 2.3%, by the end of this year, absent any import duties. But they expect tariffs will raise end-of-year inflation to 2.8%.

On Tuesday, Powell acknowledged that higher tariffs could lift inflation and limit the central bank’s ability to cut rates, calling it “a possible outcome.”

But he emphasized that it would depend on how many imports are hit with tariffs and for how long.

“In some cases, it doesn’t reach the consumer much, and in some cases it does,” Powell said. “And it really does depend on facts that we haven’t seen yet.”
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The 27-nation European Union and Canada quickly vowed Tuesday to stand firm against U.S. President Donald Trump’s move to impose 25% tariffs on their steel and aluminum exports, verbal sparring that could lead to a full-blown trade war between the traditionally allied nations.

“The EU will act to safeguard its economic interests,” European Commission President Ursula von der Leyen said in a statement. “Tariffs are taxes — bad for business, worse for consumers.

“Unjustified tariffs on the EU will not go unanswered — they will trigger firm and proportionate countermeasures,” she said.

Trump said the steel and aluminum tariffs would take effect on March 12. In response, EU officials said they could target such U.S. products as bourbon, jeans, peanut butter and motorcycles, much of it produced in Republican states that supported Trump in his election victory.

The EU scheduled a first emergency video on Wednesday to shape the bloc’s response.

Prime Minister Donald Tusk of Poland, which holds the EU presidency, said it was “important that everyone sticks together. Difficult times require such full solidarity.”

Canadian Prime Minister Justin Trudeau said during a conference on artificial intelligence in Paris that Trump’s steel and aluminum levy would be “entirely unjustified,” and that “Canadians will resist strongly and firmly if necessary.”

Von der Leyen is meeting Tuesday with U.S. Vice President JD Vance in Paris, where they are expected to discuss Trump’s tariff orders.

“We will protect our workers, businesses and consumers,” she said in advance of the meeting.

Trump imposed the steel and aluminum tariff to boost the fortunes of U.S. producers.

“It’s a big deal,” he said. “This is the beginning of making America rich again.”

Billionaire financier Howard Lutnick, Trump’s nominee to lead the Commerce Department, said the tariff on the imports could bring back 120,000 U.S. jobs.

As he watched Trump sign an executive order, Lutnick said, “You are the president who is standing up for the American steelworker, and I am just tremendously impressed and delighted to stand next to you.”

Trump’s proclamations raised the rate on aluminum imports to 25% from the previous 10% that he imposed in 2018 to aid the struggling sector. And he restored a 25% tariff on millions of tons of steel and aluminum imports.

South Korea — the fourth-biggest steel exporter to the United States, following Canada, Brazil and Mexico — also vowed to protect its companies’ interests but did not say how.

South Korean acting President Choi Sang-mok said Seoul would seek to reduce uncertainties “by building a close relationship with the Trump administration and expanding diplomatic options.”

The spokesperson of British Prime Minister Keir Starmer said London was “engaging with our U.S. counterparts to work through the detail” of the planned tariffs.

In Monday’s executive order, Trump said “all imports of aluminum articles and derivative aluminum articles from Argentina, Australia, Canada, Mexico, EU countries and the UK” would be subject to additional tariffs.

The same countries are named in his executive order on steel, along with Brazil, Japan and South Korea.

“I’m simplifying our tariffs on steel and aluminum,” Trump said. “It’s 25% without exceptions or exemptions.”

Bernd Lange, the chair of the European Parliament’s international trade committee, warned that previous trade measures against the U.S. were only suspended and could legally be easily revived.

“When he starts again now, then we will, of course, immediately reinstate our countermeasures,” Lange told rbb24 German radio. “Motorcycles, jeans, peanut butter, bourbon, whiskey and a whole range of products that of course also affect American exporters” would be targeted, he said.

In Germany, the EU’s largest economy, Chancellor Olaf Scholz told parliament that “if the U.S. leaves us no other choice, then the European Union will react united.”

But he warned, “Ultimately, trade wars always cost both sides prosperity.”

The European steel industry expressed concerns about the Trump tariffs.

“It will further worsen the situation of the European steel industry, exacerbating an already dire market environment,” said Henrik Adam, president of the European Steel Association.

He said the EU could lose up to 3.7 million tons of steel exports. The United States is the second-largest export market for EU steel producers, representing 16% of the total EU steel exports.

“Losing a significant part of these exports cannot be compensated for by EU exports to other markets,” Adam said.

Some material in this report came from The Associated Press and Agence France-Presse.
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Washington — President Donald Trump moved to substantially raise tariffs on steel and aluminum imports on Monday, canceling exemptions and duty-free quotas for major suppliers Canada, Mexico, Brazil and other countries in a move that could boost the risk of a multifront trade war. 

Trump signed proclamations that raised the tariff rate on aluminum imports to 25% from the previous 10% that he imposed in 2018 to aid the struggling sector. His action reinstates a 25% tariff on millions of tons of steel imports and aluminum imports that had been entering the U.S. duty free under quota deals, exemptions and thousands of product exclusions. 

The proclamations were extensions of Trump’s 2018 Section 232 national security tariffs to protect steel and aluminum makers. A White House official said the exemptions had eroded the effectiveness of these measures. 

Trump also will impose a new North American standard requiring steel imports to be “melted and poured” and aluminum to be “smelted and cast” in the region to curb imports of minimally processed Chinese steel into the U.S. 

The order also targets downstream steel products that use imported steel for tariffs. 

Trump’s trade adviser Peter Navarro said the measures would help U.S. steel and aluminum producers and shore up America’s economic and national security. 

“The steel and aluminum tariffs 2.0 will put an end to foreign dumping, boost domestic production and secure our steel and aluminum industries as the backbone and pillar industries of America’s economic and national security,” he told reporters. 

“This isn’t just about trade. It’s about ensuring that America never has to rely on foreign nations for critical industries like steel and aluminum.” 

Trump first broached the steel and aluminum action on Sunday, adding that he would also announce a further set of reciprocal tariffs later in the week, drawing warnings of retaliation from trade partners.
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New Chinese tariffs on a range of U.S. goods went into effect Monday, following U.S. President Donald Trump’s decision to impose a 10% tariff on Chinese products last week. Tariffs of 25% on steel and aluminum are next.

Despite the tariffs and rising tensions, both sides seem reluctant to launch into a full-on trade war, analysts say.

Beijing has its plate full battling its own internal economic struggles, and for now President Trump has deferred most of his promised tariffs on the world’s second-largest economy.

Last week, The Wall Street Journal reported that Beijing is preparing to offer to return to a so-called “Phase 1” trade deal that was signed during Trump’s first term.

The Trump administration has sent its own signals as well. 

Trump has called for the Office of the United States Trade Representative to review the first phase of the U.S.-China trade agreement and determine whether Beijing has fulfilled its commitments in the contract.

Last week, Jamieson Greer, Trump’s nominee for U.S. trade representative, said he would assess China’s compliance with the first phase of the agreement quickly upon his appointment to ensure the implementation of the deal. Greer also said he would use it as a starting point in relations with China.

What is the Phase 1 deal?

On January 15, 2020, Trump and Chinese Vice Premier Liu He signed the Phase 1 agreement, which laid out several terms for trade between the world’s two biggest economies. The deal called on the United States to cut some of its imposed tariffs on China and included a commitment from Beijing to buy more U.S. products and implement certain reforms.

The 96-page agreement, divided into eight sections, placed a big emphasis on reducing the U.S. trade deficit with China, and protecting domestic industries by cracking down on Chinese trade practices, such as nontariff trade barriers, intellectual property violations and the forced transfer of technology without adequate compensation.

The agreement mandated that China purchase at least $200 billion in U.S. products and services over a two-year period from January 1, 2020, to December 31, 2021. It also required that Beijing stop subsidizing strategic sectors and give fairer treatment to American companies in terms of regulation.

Despite those commitments from China, data from a report published in 2022 by the Peterson Institute for International Economics in Washington showed that Beijing did not reach its purchase target.

The report also showed that Beijing has completed 57% of the spending laid out in the agreement, a total that is lower than the level of China’s purchase of goods from the United States before the U.S.-China trade war.

Although China was not expected to fully meet its commitments, the agreement did have some benefits for Washington, as it helped decrease Washington’s trade deficit with Beijing.

Starting point

Analysts say the agreement may be revisited as a starting point for new trade discussions.

“The two sides need to start somewhere. Phase 1 may at least provide some common language that both sides will be familiar with so as to get that ball rolling,” Chad Brown, senior fellow at the Peterson Institute for International Economics, explained to VOA in an emailed response Friday.

Denny Roy, a senior fellow at the East-West Center in Hawaii, says the Phase 1 agreement has two advantages for acting as a foundation for U.S.-China trade discussions.

“First, the two sides reached a similar agreement before, so they know it’s feasible,” he told VOA in an emailed response on Friday.

He also explained that using the agreement “suits both sides’ interests.”

“Trump wants to claim he has resolved the bilateral trade imbalance, which he sees as his primary measure of success,” he explained, noting that this agreement supports that narrative.

He added that the deal benefits Beijing by allowing China to avoid making significant structural reforms.

Roy, however, adds that several factors make an agreement between Washington and Beijing difficult.

“A major bilateral economic deal would depend on avoiding a strategic crisis, which might occur over Taiwan or the South China Sea, or an encounter between U.S. and Chinese ships or aircraft that escalates, or something like the spy balloon incident,” he said.

Early in 2023, the discovery of a Chinese spy balloon floating through U.S. airspace delayed a U.S. diplomatic visit to the country by then-Secretary of State Antony Blinken. The ballon was eventually shot down.
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ABOARD AIR FORCE ONE — U.S. President Donald Trump said Sunday that he will announce on Monday new 25% tariffs on all steel and aluminum imports into the U.S., which would come on top of existing metals duties in another major escalation of his trade policy overhaul.

Trump, speaking to reporters on Air Force One, also said he will announce reciprocal tariffs Tuesday or Wednesday, to take effect almost immediately.

Trump, during his first term, imposed tariffs of 25% on steel and 10% on aluminum, but later granted several trading partners duty-free quotas, including Canada, Mexico and Brazil.

Former President Joe Biden extended these quotas to Britain, Japan and the European Union, and U.S. steel mill capacity utilization has dropped in recent years.

White House spokesperson Karoline Leavitt said that the new tariffs would come on top of the existing duties on steel and aluminum.

Trump on Friday announced that he would impose reciprocal tariffs — raising U.S. tariff rates to match those of trading partners — on many countries this week. He did not identify the countries, but the duties would be imposed “so that we’re treated evenly with other countries.”
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VILNIUS — Estonia, Latvia and Lithuania said on Sunday they had successfully synchronized their electricity systems to the European continental power grid, one day after severing decades-old energy ties to Russia and Belarus.

Planned for many years, the complex switch away from the grid of their former Soviet imperial overlord is designed to integrate the three Baltic nations more closely with the European Union and to boost the region’s energy security.

“We did it!,” Latvian President Edgars Rinkevics said in a post on social media X.

After disconnecting on Saturday from the IPS/UPS network, established by the Soviet Union in the 1950s and now run by Russia, the Baltic nations cut cross-border high-voltage transmission lines in eastern Latvia, some 100 meters from the Russian border, handing out pieces of chopped wire to enthusiastic bystanders as keepsakes.

EU foreign policy chief Kaja Kallas, herself an Estonian, earlier this week called the switch “a victory for freedom and European unity.”

The Baltic Sea region is on high alert after power cable, telecom links and gas pipeline outages between the Baltics and Sweden or Finland. All were believed to have been caused by ships dragging anchors along the seabed following Russia’s invasion of Ukraine. Russia has denied any involvement.

Poland and the Baltics deployed navy assets, elite police units and helicopters after an undersea power link from Finland to Estonia was damaged in December, while Lithuania’s military began drills to protect the overland connection to Poland.

Analysts say more damage to links could push power prices in the Baltics to levels not seen since the invasion of Ukraine, when energy prices soared.

The IPS/UPS grid was the final remaining link to Russia for the three countries, which re-emerged as independent nations in the early 1990s at the fall of the Soviet Union, and joined the European Union and NATO in 2004.

The three staunch supporters of Kyiv stopped purchases of power from Russia following Moscow’s invasion of Ukraine in 2022 but have relied on the Russian grid to control frequencies and stabilize networks to avoid outages.
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NEW YORK — U.S. stocks slumped Friday amid worries about higher inflation and tariffs, while a closely watched report gave a mixed picture of the U.S. job market. 

The S&P 500 was down almost 1%, and the Dow Jones Industrial Average fell more than 400 points, or almost 1%. A sharp drop for Amazon following its latest profit report helped drag the Nasdaq composite down about 1.4%. 

Treasury yields also climbed in the bond market after a discouraging report on Friday morning suggested sentiment was unexpectedly souring among U.S. consumers. The preliminary report from the University of Michigan said U.S. consumers were expecting inflation in the year ahead to hit 4.3%, the highest such forecast since 2023. 

That’s a full percentage point above what they were expecting a month earlier, and it’s the second straight increase of an unusual amount. Economists pointed to the possibility of U.S. tariffs on a wide range of imported products, which President Donald Trump has proposed, and which could ultimately push up prices for U.S. consumers. 

Trump said Friday that he was likely to have an announcement on Monday or Tuesday on “reciprocal tariffs, where a country pays so much or charges us so much, and we do the same.” 

Jobs report

The consumer-sentiment data followed a mixed report on the U.S. job market. It showed hiring last month was less than half of December’s rate, but it also included encouraging nuggets for workers: The unemployment rate eased, and workers saw bigger gains in average wages than economists expected. 

All the data taken together could keep the Federal Reserve on hold when it comes to interest rates. The Fed began cutting its main interest rate in September in order to relax the pressure on the economy and job market, but it warned at the end of the year that it might cut fewer times in 2025 than it had expected, given worries about inflation staying stubbornly high. 

Interest rates are one of the things Wall Street cares most about, because lower rates can lead to higher prices for stocks and other investments. The downside is they can also give inflation more fuel. 

For Scott Wren, senior global market strategist at Wells Fargo Investment Institute, the jobs report did nothing to change his forecast for the Fed to cut the federal funds rate just once in 2025. That’s a touch more conservative than many traders on Wall Street, who collectively see a roughly 45% chance that the Fed will cut at least twice, according to data from CME Group. Of course, some traders are also betting on the possibility of zero cuts. 

Wren said financial markets could stay shaky in the near term, not only because of uncertainty about interest rates but also because of Trump’s tariffs and other unknowns around the world. 

Worries about a potentially punishing global trade war, which rocked markets earlier in the week, have eased a bit after Trump gave 30-day reprieves for tariffs on Mexico and Canada. But “Europe might be next, and even if the final outcome is benign, uncertainty could weigh on global investment,” Bank of America economists wrote in a BofA Global Research report. 

A fear among economists is that when U.S. households expect inflation to be high in the future, they could begin buying things in advance and making other moves that can set off a self-fulfilling cycle that worsens inflation.
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HONG KONG/SEOUL/SHANGHAI — The U.S. Postal Service said on Wednesday it would accept parcels from China and Hong Kong, in a U-turn after a suspension following President Donald Trump ending a trade provision used by retailers including Temu, Shein, and Amazon AMZN.O to ship low-value packages duty-free to the U.S. 

“The USPS and Customs and Border Protection are working closely together to implement an efficient collection mechanism for the new China tariffs to ensure the least disruption to package delivery,” it said in a statement. 

The Trump administration imposed an additional 10% tariff on Chinese goods and closed the “de minimis” exemption that allows U.S. shoppers to avoid paying tariffs for shipments below $800 from China. 

USPS did not immediately comment on whether its temporary suspension had been tied to Trump’s order ending de minimis shipments from China, which was announced on Saturday and came into force from one minute past midnight on Tuesday. 

“There has really been absolutely zero time for anyone to prepare for this,” said Maureen Cori, co-founder at New York-based consultancy Supply Chain Compliance. “What we really need is direction from the government on how to handle this without warning or notice.” 

Currently, de minimis parcels are consolidated so that customs can clear hundreds or thousands of shipments at once, but they will now require individual clearances, significantly increasing the burden for postal services, brokers and customs agents, said Cori.
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