Trump Declaring Economic Emergency to Justify Tariff Plan?

President-elect Donald Trump is considering declaring a national economic emergency in the United States.

According to CNN, this move aims to justify his controversial tariff program.

The International Emergency Economic Powers Act (IEEPA) would allow him to act.

This legislation provides broad powers to manage imports during a national crisis.

Trump Prefers the IEEPA but is Still Evaluating Legal Options for Tariff Plan

Sources close to Donald Trump suggest that he has a «preference» for this law.

The IEEPA facilitates the imposition of tariffs for national security reasons.

However, Trump has not yet made a final decision on the matter.

His legal team is exploring other avenues to justify the proposed tariffs.

One option is Section 338 of U.S. trade law.

This section allows tariffs to be imposed on countries that discriminate against U.S. trade, and this could work for Trump’s plan.

The news had an immediate impact on financial markets.

Stocks on Wall Street opened lower after the information was made public.

In contrast, the U.S. dollar strengthened against other currencies.

In 2019, Donald Trump had previously threatened to use the IEEPA against Mexico.

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At that time, he planned to impose tariffs of 5%, which could escalate to 25%.

The goal was to reduce undocumented immigration from Mexico.

During his campaign, Trump promised a 25% tariff on goods from Mexico and Canada.

He argued that these tariffs would be a response to the flow of drugs and illegal immigration.

He also proposed a 60% tariff on Chinese products due to fentanyl, later adjusting it to 10%.

The declaration of an economic emergency remains a real possibility.