TARIFFS: Kyodo Report Appears To Refer To Existing US-Japan Tariff "Deal"
It seems the Kyodo report referred to earlier by Bloomberg ("US TO IMPOSE ADDITIONAL 15% TARIFF ON JAPAN IMPORTS: KYODO") is not referring to an additional "new" tariff, but merely a White House confirmation of the previously announced "deal" under which the reciprocal tariff rate on Japanese goods due to take effect Thursday would be 15%. Though it's still somewhat unclear - and while USDJPY has started to come back, it has maintained most of its 0.2% rise in the dollar's favor on the back of the original headlines.
- This is the entire Bloomberg article: "The US plans to impose an additional 15% tariff on Japan, regardless of existing tariff rates, as part of reciprocal tariffs set to be imposed on various countries and regions, Kyodo News reports, citing an unidentified White House official. The 15% tariff will come on top of existing tariffs, the Kyodo report says"
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
TARIFFS: Full Set Of 14 (So Far) US Tariff Rates To Be Imposed Aug 1
The latest 6 tariff rates have been announced by President Trump on Truth Social - we've now received all of the total 12 that were expected to be announced this afternoon, in addition to the South Korea and Japan rates that had been announced earlier in the day.
- Reminder that the White House is expected to send more tariff "letters" in the coming days regarding the rates to be set as of August 1, with the major expected "exception" being the EU which Reuters reported earlier is still trying to reach an agreement with the US.
- Bosnia and Herzegovina: 30% tariff (original reciprocal tariff was 36%)
- Indonesia: 32% (original was 32% so no change)
- Bangladesh: 35% (original was 37%)
- Serbia: 35% (original was 37%)
- Cambodia: 36% (original was 49%)
- Thailand: 36% (original was 36% so no change)
To recap from earlier:
- Japan: 25% (original was 24%)
- South Korea: 25% (original was 25% so no change)
- Tunisia: 25% (original was 28%)
- Malaysia: 25% (original was 24%)
- Kazakhstan: 25% (original was 27%)
- South Africa: 30% (original was 31%)
- Laos: 40% (original was 48%)
- Myanmar: 40% (original was 45%)
TARIFFS: US Announces 25% Tariffs On Tunisia; SKorea To Step Up Negotiations
US President Trump on Truth Social announces 25% tariffs on Tunisia (the original reciprocal tariff had been 28%). Could be some more announcements coming, that's now 6 of the supposed 12 due today (apart from SKorea and Japan) that have now been announced.
- Separately, Reuters reports that South Korea has issued a statement saying it will attempt to accelerate trade negotiations ahead of the Aug 1 deadline: "SOUTH KOREA SAYS IT WILL STEP UP TRADE NEGOTIATIONS WITH THE U.S. TO WIN MUTUALLY BENEFICIAL RESULTS AND CLEAR UP UNCERTAINTIES CAUSED BY TARIFFS - STATEMENT"
US DATA: Global Supply Chain Pressures Not Worsening Amid Tariffs
The New York Fed's Global Supply Chain Pressure Index (GSCPI) fell to 0.00 in June from 0.30 in May (upward rev from an initial reading of 0.19). That means the index is zero standard deviations from the index’s historical average - so very much in normal territory despite an uptick in container prices in May amid apparent US tariff front-loading.
- The GSCPI was a closely-watched measure during the pandemic as supply chains were impaired amid strong goods demand, pushing goods inflation sharply higher through 2021-22. See charts.
- There doesn't appear to be anywhere near the same sustained pressure now, despite signs in various indicators (including slower manufacturing ISM delivery times) that would suggest incipient price pressures working their way through.
- While the imposition of tariffs will have an upside impact on prices, those aren't reflected in import price indices. Meanwhile the steady GSCPI suggests US core goods prices, while higher, don't look like they will be pushed up further by global supply chain issues in the near-term.
