Trump Tariffs Trigger Economic Slowdown, Heighten Recession Risks

Recent announcements of sweeping tariffs by President Donald Trump, termed 'Liberation Day,' have raised significant concerns about the U.S. economy, prompting economists to revise their forecasts downward. The tariffs, starting at a minimum of 10% on most imports, are contributing to fears of rising inflation and potential job losses, with some experts suggesting that the effective tariff rate could reach as high as 25%, the highest in over a century. The services sector has shown signs of slowing, reaching a nine-month low, as consumer sentiment declines amidst these tariff uncertainties. Fitch Ratings has warned that these new tariffs could push the nation towards a recession and limit the Federal Reserve's ability to cut interest rates. The market reaction has been severe, with major stock indices experiencing significant declines, reflecting widespread panic among investors. Local economies, especially those reliant on exports, may face additional challenges as global demand weakens and trade barriers increase.