In a surprising pivot just ahead of the midterm elections, President Donald Trump rolled back certain tariffs on steel and aluminum imports on Thursday, easing pressure on U.S. manufacturers and consumers. The move comes as voters continue to feel the pinch from rising costs on everyday goods, highlighting the political stakes of trade policy.
The rollback followed intense back-and-forth in Congress over Trump’s metal tariffs. On Wednesday, six Republicans broke ranks and joined nearly every Democrat to pass Joint Resolution 72, which seeks to terminate a national emergency declared by Trump last February. That emergency had imposed tariffs on Canadian steel and aluminum, a decision that had sparked ongoing tensions with U.S. allies.
Trump openly warned lawmakers against opposing his tariff regime, posting on Truth Social that Republicans who cross him “will seriously suffer the consequences come Election time.” Despite the threats, the bipartisan vote highlighted growing unease within his own party over the impact of tariffs on consumer prices and supply chains.
Trade Tensions Flare Beyond Metals
While easing tariffs on steel and aluminum, Trump’s broader trade posture remains aggressive. Bloomberg reports that the President has considered exiting the North American trade pact, raising fresh uncertainty about U.S.-Mexico-Canada trade negotiations.
Trump recently threatened Canada with a 50% tariff on aircraft imports, citing certification hurdles that allegedly blocked U.S. Gulfstream jets. He also warned of a 100% tariff on Canadian goods tied to its trade with China. Meanwhile, Mexico faces the prospect of new levies over oil exports to Cuba.
In another trade arena, confusion has emerged over the U.S.-India agreement. The White House revised language around agricultural goods, removing a reference to pulses—a staple in India. Under the deal, baseline U.S. tariffs on Indian goods will drop to 18% from 25%, and secondary tariffs related to India’s Russian oil purchases will be lifted, according to the administration. Trump emphasized that Indian Prime Minister Narendra Modi has agreed to halt purchases of Russian oil, a key point in the tariff reductions.
Political Implications
The timing of the tariff rollback is politically charged. Midterm voters are increasingly sensitive to inflation and the rising cost of goods—issues tied directly to tariffs. By easing certain metal duties, Trump appears to be balancing between maintaining a tough-on-trade persona and addressing immediate economic concerns.
However, the rollback does not signal a complete retreat from Trump’s broader trade strategy. His administration continues to wield tariffs as a negotiating tool, sending mixed signals to allies and markets alike. Economists warn that this piecemeal approach could create uncertainty for U.S. businesses navigating global supply chains.
What This Means for Markets
Metals & Manufacturing: Stocks of steel and aluminum producers may see relief from lower input costs.
Aerospace: Bombardier and U.S. aircraft exporters remain under scrutiny given potential Canada tariffs.
Agriculture & Food: U.S.-India trade clarity may ease some pressure on agricultural exports and importers.
Political Risk: Investors will be watching midterm election outcomes closely, as trade decisions could become a key campaign issue.
Bottom line: Trump’s selective tariff rollback is a high-stakes maneuver that eases short-term economic pressure while keeping global trade tensions simmering. With midterms approaching, the move may appeal to voters feeling the brunt of rising costs—but it also leaves the door open for future trade showdowns with allies.