On Thursday, U.S. President Donald Trump signed a memorandum instructing his administration to levy “reciprocal tariffs,” which means that the U.S. will charge foreign countries tariffs equal to those that those countries charge the United States. This is part of an effort to eliminate the U.S. trade deficit and combat unfair trade practices. Their indexes also redefine “reciprocity” as country-by-country rather than overall trade balance, which is in effect Trump’s approach.
Critics warn that further increases could drive U.S. tariffs (10-15% higher), which might slow, not speed up, U.S. economic growth while collecting more revenue. It might also lead to trade tensions and stagnation in negotiations.