Markets and economic observers navigated another day of Trump trade activity Tuesday with the growing question being when long-promised deals would materialize.
Trump began the week promising a mix of “Letters, and/or Deals,” but with only the former in evidence so far after multiple days of promises and the unilateral declarations of tariffs to 14 countries that came Monday.
The focus on letters continued on Tuesday morning with Trump promising more letters “today, tomorrow, and for the next short period of time” while also underling the firmness of his August 1 deadline that he implemented Monday by executive order.
“No extensions will be granted,” he wrote on Truth Social.
Trump has pledged 25% duties on South Korea and Japan on that date with some rates as high as 40% on other nations in numbers that closely tracked rates that were first promised in April (and rattled stocks at the time).
What’s been left out so far are deal announcements with Trump Monday evening not sounding like a promised flurry of deals to lower rates are in the offing — at least in the next few days.
“We’re close to making a deal with India,” the president said during dinner with Israeli Prime Minister Benjamin Netanyahu before immediately adding, “Others we’ve met with and we don’t think we’re going to be able to make a deal, so we just send them a letter.”
The commentary is likely in part a negotiating ploy from the president, as there is ample evidence that negotiations with both India and the EU are making progress.
But it raised the question for markets as to whether this week will end up being more notable for market-unfriendly moves instead of a mix of proverbial carrots — in the form of deals to lower rates from April levels — and sticks.
Read more: The latest news and updates on Trump’s tariffs
The overall context, as Ed Mills of Raymond James put it, could be that markets will have to contend with “a near-term trade escalation” in the coming days as negotiation timelines shift toward the end of the month.
That will “continue to drive trade-related market uncertainty given the shifting deadlines.”
“We read Trump’s choice to reiterate the threat of Liberation Day numbers as a hawkish signal,” Tobin Marcus of Wolfe Research added in another note.
“Investors might just totally discount these threats,” he added, “but it’s not hard for us to imagine some of these tariffs taking effect.”
President Trump speaks during a dinner with Israeli Prime Minister Benjamin Netanyahu at the White House on July 7. (Andrew Harnik/Getty Images) · Andrew Harnik via Getty Images
Trump’s comments appeared to undercut some of his aides — Treasury Secretary Scott Bessent had said just hours earlier on CNBC, “We are going to have several announcements in the next 48 hours” — but evidence remained ample that progress could be announced in the coming hours and days.
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