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Trump to Announce Semiconductor Tariff Rate, Signaling Shift in Trade Policy
WASHINGTON — President Trump stated on Sunday that he would disclose the tariff rate on imported semiconductors within the coming week. He indicated potential flexibility for specific companies within the industry, suggesting a nuanced approach to the impending trade measures. This declaration implies that the prior exemption of smartphones and computers from reciprocal tariffs on China is likely to be temporary as the administration aims to reshape trade dynamics in the crucial semiconductor sector.
“We sought to simplify the situation, separating it from numerous other businesses, because our objective is to manufacture our chips, semiconductors, and related products domestically,” Trump conveyed to reporters aboard Air Force One while returning to Washington from his Mar-a-Lago resort in West Palm Beach.
While the President refrained from specifying whether certain products, such as smartphones, might still receive exemptions, he added, “You must demonstrate a degree of adaptability. Excessive rigidity is unwarranted.”
National Security Probe Initiated into Semiconductor Sector
Earlier on Sunday, the President announced a national security investigation into the semiconductor industry, underscoring the strategic importance of this sector.
“We are examining Semiconductors and the ENTIRE ELECTRONICS SUPPLY CHAIN as part of the forthcoming National Security Tariff Investigations,” he posted on social media, emphasizing the comprehensive scope of the inquiry.
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Tech Industry Reacts to Evolving Tariff Landscape
The White House had previously announced exclusions from substantial reciprocal tariffs on Friday, raising hopes that the technology sector might avoid entanglement in the escalating trade dispute between the two global economies and that everyday consumer electronics like mobile phones and laptops would remain accessible in terms of price.
However, Commerce Secretary Howard Lutnick clarified on Sunday that critical technology goods originating from China, including semiconductors, would face distinct new levies within the next two months. This statement tempered initial optimism and signaled a more targeted approach to tariffs.
Impact of Tariff Uncertainty on Financial Markets
President Trump’s fluctuating tariff pronouncements in the past week contributed to the most dramatic fluctuations in stock markets since the 2020 COVID-19 pandemic. The S&P 500 index has experienced a decline exceeding 10% since President Trump assumed office on January 20.
Details of Forthcoming Tariffs on Electronics
Secretary Lutnick indicated that President Trump intends to impose “a specialized tariff approach” on smartphones, computers, and other electronic items within the next one to two months, alongside sector-specific tariffs targeting semiconductors and pharmaceuticals. These new levies would be separate from the reciprocal tariffs, which had already elevated duties on Chinese imports to 125% the previous week, he explained.
“He is indicating they are excluded from the reciprocal tariffs, but they are encompassed within the semiconductor tariffs, which are anticipated in approximately a month or two,” Lutnick stated during an interview on ABC’s “This Week,” predicting that the duties would incentivize domestic production of these goods in the United States.
China Responds to US Tariff Measures
In response to US actions, Beijing increased its own tariffs on US imports to 125% on Friday. Prior to Secretary Lutnick’s remarks on Sunday, China announced it was evaluating the implications of the exclusions for technology products implemented late on Friday.
“The one who tied the bell to the tiger’s neck can only untie it,” stated China’s Ministry of Commerce, suggesting a need for the initiating party to resolve the trade tensions.
Calls for Tariff Pause and Strategic Reassessment
Billionaire investor Bill Ackman, who previously endorsed President Trump but has voiced concerns about the tariffs, urged him on Sunday to temporarily suspend the broad reciprocal tariffs on China for three months, mirroring a similar pause extended to most nations the previous week.
Ackman argued on X that a 90-day pause on Chinese tariffs, coupled with a temporary reduction to 10%, “would achieve the same objective in compelling U.S. companies to realign their supply chains away from China without the associated disruption and risk.”
Market Strategist Criticizes Tariff Handling
Sven Henrich, founder and lead market strategist for NorthmanTrader, expressed strong criticism on Sunday regarding the handling of the tariff issue.
“Sentiment check: The most substantial market rally of the year would occur on the day Lutnick is dismissed,” Henrich posted on X. “I propose the administration determines message control, whatever that message may be, as it is perpetually changing. U.S. businesses are unable to strategically plan or invest amidst constant policy reversals.”
Senator Warren Condemns Tariff Policy
Senator Elizabeth Warren (D-Mass.) denounced the latest alteration to President Trump’s tariff strategy, which economists caution could impede economic growth and exacerbate inflation.
“There is no discernible tariff policy — only disorder and malfeasance,” Warren asserted on ABC’s “This Week,” prior to President Trump’s latest social media communication.
Exclusions Listed in Customs Notice
In a notification to shippers issued late Friday, U.S. Customs and Border Protection released a catalog of tariff codes excluded from the import duties. This list encompassed 20 product categories, including computers, laptops, disc drives, semiconductor devices, memory chips, and flat panel displays.
Trade Advisor Highlights Negotiation Invitation to China
In an interview on NBC’s “Meet the Press,” White House trade advisor Peter Navarro stated that the U.S. has extended an invitation to China for negotiations. However, he criticized China’s connection to the illicit fentanyl supply chain and excluded it from a group of seven entities—the United Kingdom, the European Union, India, Japan, South Korea, Indonesia, and Israel—with whom he indicated the administration was engaged in discussions.
Trade Representative Expresses Hope for Non-China Deals
Trade Representative Jamieson Greer commented on CBS’s “Face the Nation” that there were no immediate plans for President Trump to engage with Chinese President Xi Jinping regarding tariffs, accusing China of instigating trade friction through retaliatory levies. He did, however, express optimism about securing agreements with countries other than China.
“My objective is to finalize meaningful agreements within 90 days, and I anticipate achieving this with several nations in the coming weeks,” Greer stated, indicating a proactive approach to trade negotiations.
Hedge Fund Founder Warns of Recession Risk
Ray Dalio, the billionaire founder of the world’s largest hedge fund, conveyed to NBC’s “Meet the Press” his apprehension regarding the United States potentially entering a recession, or a more severe economic downturn, as a consequence of the tariffs.
“Presently, we are at a critical decision juncture and in close proximity to a recession,” Dalio warned on Sunday. “And I am concerned about an outcome even more detrimental than a recession if this situation is not adeptly managed.”