Donald Trump says tariffs will bring 'a little disturbance' to US economy

Tariff relief

Commerce Secretary Howard Lutnick however said Tuesday that Trump could dial down hefty levies on Canada and Mexico this week, while maintaining pressure on China.

“I think he’s going to work something out with them,” Lutnick told Fox Business, adding the announcement would probably come on Wednesday.

“Somewhere in the middle will likely be the outcome, the president moving with the Canadians and Mexicans, but not all the way,” he said.

On Tuesday, Trump also took aim in his speech at the European Union and countries including Brazil, India and South Korea over what he called “unfair” practices.

He said reciprocal tariffs tailored to US trading partners would “kick in” on April 2.

Analysts and businesses have warned that higher import costs could raise prices for consumers, and this may complicate efforts to bring down inflation — one of the issues that got Trump elected.

Mexico supplied 63 percent of US vegetable imports and nearly half of fruit and nut imports in 2023, according to the US Department of Agriculture.

Brian Cornell, chief executive of US retail giant Target, said Tuesday the company could be forced to raise the cost of some fruits and vegetables over the coming days.

“The short-term effect of any tariff clearly is inflation,” Charles van der Steene, the North America president for shipping giant Maersk, told CNBC. “It’s inflationary in its essence.”

Housing costs could also be hit. More than 70 percent of imports of two key building materials — softwood lumber and gypsum — come from Canada and Mexico, according to the National Association of Home Builders.