08.07.25 - 23 more days to ignore tariffs
President Donald Trump yesterday announced a new round of unilateral tariffs affecting 14 countries, set to take effect on August 1. Among the major trading partners, Japan and South Korea received the most favorable treatment, each facing a 25% tariff. Other countries were assigned rates ranging up to 40%.
All tariffs have now been synchronized to the August 1 implementation date, giving countries a limited window to negotiate more favorable terms before the deadline.
In response, the European Union is reportedly seeking a preliminary agreement with the US in an effort to secure a 10% tariff rate that would remain valid even beyond the August deadline.
Meanwhile, like many EU countries, Switzerland is still awaiting its official tariff letter from Washington.
Markets: Asian equity indices up during the last trading session - European and US equities trading sideways while long-term yields are rising - US dollar weaker - gold price remains above USD 3’300/oz.
My view: Despite the latest tariff announcement from President Donald Trump, investor sentiment remains largely unconcerned. With the new implementation date now pushed to August 1, markets have effectively been granted another 23 days to ignore the issue. Trump had previously marked July 9 as a hard deadline - now postponed. Is this yet another case of "TACO" (Trump Always Chickens Out), or just a “semi-TACO” delay?
One thing is clear: a day will come when tariffs are defined and enforced. The US needs additional revenue to fund the “Big Beautiful Bill,” which includes substantial tax cuts. Betting on a world without tariffs is therefore redundant. The real question isa: who will ultimately pay the price? Consumers or corporations? That answer will only emerge in the months ahead.
While the August 1 deadline buys time, it does not buy certainty. Markets remain priced for perfection, with investor positioning still reflecting high levels of optimism. That complacency leaves room for a sharper correction if reality falls short of expectations.
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