US Treasury Sec. Bessent: US has a strong Dollar policy
In an interview with Fox Business Network on Wednesday, US Treasury Secretary Scott Bessent said China's decision to raise tariffs on US imports to 84% is "unfortunate," per Reuters.
Key takeaways
"China's escalation is a loser for them."
"They can raise their tariffs but so what."
"A very good step with the Chinese is to acknowledge fentanyl precursors."
"China needs to punish people exporting fentanyl precursors to US."
"Allies coming to talk to US should think about how to rebalance China."
"China should not try to devalue their way out of this."
"China should come to the table."
"I think nothing systemic about deleveraging in bond market."
"Expecting bond market to calm down."
"Deregulation should let banks buy more treasuries."
"The US has a strong Dollar policy."
Tariffs FAQs
Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas.
Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers.
There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs.
During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
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