Trump's Trade Policies Face Challenges and Criticism

The White House is growing increasingly impatient for trade deals as economic anxiety builds, with President Donald Trump facing a messaging challenge in explaining the potential negative short-term effects of his tariffs on the economy. Trump has been shifting his message depending on his audience, downplaying the potential impact on consumers at a rally, but later warning that Americans may need to adjust their spending habits due to higher prices resulting from the tariffs. Officials are under pressure to produce new trade agreements, with top officials claiming to be close to striking deals with countries like Japan, South Korea, and India. The administration is also emphasizing Trump's tax plan, with Treasury Secretary Scott Bessent hoping to finalize a tax package by early July. Despite the optimism, quiet anxiety is building among those involved in crafting Trump's economic plan, who recognize the need to make substantial progress quickly to alleviate public concerns. Trump is attempting to blame his predecessor, Joe Biden, for the current economic state, but some of his supporters are not buying this explanation.

US President Donald Trump has asked business leaders for "a little bit of time" to address the US economy, which contracted 0.3% in the first quarter, its first shrinkage in three years. Trump blamed his predecessor, incorrectly referring to Joe Biden, for the disappointing data and attributed the decline to companies stockpiling imports ahead of his tariffs. He highlighted $8 trillion in promised inward investments and urged Congress to pass his tax bill, while dismissing recession fears and downplaying the impact of tariffs on consumer goods.

Donald Trump's claims of creating a new "golden age" for the US economy are being threatened by a GDP report showing a 0.3% contraction in the first quarter. Trump's administration is trying to spin the data, blaming it on his predecessor, Joe Biden, but this argument is weakened by Trump's own initiation of a trade war with China. The report's negative figures have significant political implications, potentially eroding Trump's mystique as a master businessman and damaging his fragile GOP majority in the House. Trump's attempts to downplay the report are contradicted by evidence of a slowing economy, including a collapse in consumer confidence and rising forecasts of unemployment and inflation. The gap between Trump's rhetoric and economic reality is growing, threatening to undermine his negotiating position in trade deals and his overall political standing.

US President Donald Trump's foreign policy is being scrutinized after 100 days in office, with questions arising over whether he has a coherent strategy or is simply improvising. Trump's interactions with world leaders, including Ukrainian President Volodymyr Zelenskyy and Russian President Vladimir Putin, have been inconsistent and unpredictable, sparking debate among supporters and detractors. While supporters see Trump's flexibility as a sign of a shrewd negotiator, critics view it as a sign of incoherence and lack of control.

The US economy shrank at an annualised rate of 0.3% in the first quarter of 2025, its worst performance in three years, due to a surge in imports ahead of tariffs announced by Donald Trump. Despite this, Trump blamed his predecessor Joe Biden for the slowdown, claiming that his policies had left a negative legacy. The contraction was largely driven by companies stockpiling goods before tariffs came into effect, worsening the US trade deficit. Economists warn that Trump's tariffs may hurt growth in the second half of the year and increase recession risks.

The US GDP contracted in the first quarter of the year, posing a political risk to President Trump, who campaigned on his ability to manage the economy. The contraction came as Trump's trade war is choking off supply chains, threatening to push prices up and lead to shortages. Trump's tariffs have been met with skepticism, with 55% of Americans disapproving of his handling of the economy. Some of Trump's economic advisers now see the timing and execution of his tariff announcements as potential mistakes. Trump's strategy is expected to bring long-term benefits, but the economic pain of the tariffs could be felt within months, with upward pressure on prices and shortages of products. Trump's ability to negotiate trade deals is being tested, with some countries, like Canada, vowing to reduce their dependence on the US. China's leader, Xi Jinping, has an incentive to make the next few months politically painful for Trump.

China is holding off on serious trade talks with the US, waiting to see which of Donald Trump's advisers will have his ear on tariffs and how other countries will respond to the 90-day pause on tariffs, with sources citing the divided White House and uncertainty around Trump's final stance as the reason for the delay.

The Trump administration is nearing initial tariff deals with some US trading partners within weeks, according to US Trade Representative Jamieson Greer. However, negotiations with India are not close to completion, and there are no official talks with China underway. Greer mentioned that deals are being focused on increasing market access for US exports and reducing trade barriers.

US President Donald Trump stated that there is "a very good chance" of reaching a trade deal with China, despite US Trade Representative Jamieson Greer saying hours earlier that no official trade talks are currently underway between the two countries. Trump's comments came as the US Commerce Department released data showing a contraction in the US GDP for the first time in three years.

The Bank of Japan held its benchmark interest rate at 0.5% for a second consecutive meeting, citing uncertainty around the economy due to US President Donald Trump's tariffs. The central bank expects growth to moderate and inflation to fall between 1.5% to 2% in fiscal year 2025 ending March 2026. Despite Japan's headline inflation staying above the BOJ's 2% target for 36 months, Trump's tariffs have complicated plans to raise rates. The BOJ stated it will continue to raise its policy rate "if our economic and price forecasts are realised." Japan's economy grew 1.2% year-on-year in the fourth quarter, while full-year GDP growth in 2024 slowed to 0.1%.

The Bank of Japan has downgraded its economic growth forecast for the fiscal year starting April 1 to 0.5% from 1.1% due to the impact of US tariffs imposed by President Trump. The tariffs are expected to slow down overseas economies and decline domestic corporate profits in Japan. Japan is bracing for potentially higher tariffs on imports, including a 25% tariff on cars, which could cause a national crisis. Japanese companies are already warning of deteriorating earnings, and the tariff disruption is exacerbating pressures on an already fragile economy. The US tariffs are also complicating the Bank of Japan's efforts to normalize monetary policies, leading to a decision to keep interest rates steady at 0.5%.

Vice President JD Vance cast a tie-breaking Senate vote to kill a bipartisan effort to rebuke President Donald Trump's trade policy, specifically his global tariffs. The Senate had voted 49-49 on a resolution to block the tariffs, with two key senators absent. Senate Majority Leader John Thune then moved to prevent a future vote, prompting Vance to cast the tie-breaking vote. Trump's tariffs include a 10% tariff on most imports, 25% tariffs on steel and aluminum, and over 145% on many Chinese goods. The resolution's backers argued that the vote highlighted Republican support for the tariffs.

The Senate voted 49-49 on a bipartisan measure to undo President Trump's tariffs, with three Republicans joining Democrats in support, but it failed due to a tie. Vice President JD Vance later cast a deciding vote to table the measure, ending the effort. The resolution sought to terminate the national emergency declaration used to impose 10% reciprocal tariffs. Despite the failure, some Republicans expressed private concerns about the trade policy, and lawmakers continued to fret about the tariffs' economic impact.