U.S. Trade Court: 10% Global Tariff Replacing Reciprocal Tariffs Also Illegal

¬ Overseas IBs Forecast South Korea’s Economic Growth at 2.4% for This Year … Up by 0.3%p

+

It has been reported that the U.S. Court of International Trade ruled that the Trump administration’s newly introduced "10% global tariff" — intended to replace the reciprocal tariffs previously deemed illegal — is also unlawful.

On the 7th, the U.S. Court of International Trade determined that the Trump administration’s measure, which imposed a 10% global tariff on all trading partners based on Section 122 of the Trade Act, was unreasonable. The court stated: "The president's new tariff initiative does not meet the explicit standards set forth in this trade law." Section 122 of the Trade Act grants the president authority to impose emergency import restrictions under specific conditions.

In February, the U.S. Supreme Court ruled that reciprocal tariffs (imposed on countries based on their own tariffs) levied under the International Emergency Economic Powers Act (IEEPA) were illegal. In response, Trump immediately turned to Section 122 of the Trade Act to impose a 10% global tariff on all countries as a replacement.

The White House has yet to respond to the ruling. Foreign media predict that the Trump administration is likely to appeal the decision. If ultimately defeated, the U.S. government may be required to refund approximately $16.6 billion collected through these tariffs. In this regard, The New York Times commented: "Trump’s planned visit to China next week now puts the U.S. government in a difficult position."

+

It has been reported that major overseas investment banks (IBs) have successively upgraded their forecasts for South Korea’s economic growth this year, driven by strong chip exports and a "surprising growth" in first-quarter economic performance.

On the 8th, according to the International Financial Center, the average forecast for South Korea’s economic growth this year among eight major overseas IBs stood at 2.4%, up by 0.3 percentage points from the previous average of 2.1% at the end of March.

The largest upward revision came from JPMorgan, which raised its forecast from 2.2% to 3.0%, an increase of 0.8 percentage points. Citigroup revised its estimate from 2.2% to 2.9%, up by 0.7 percentage points; Goldman Sachs increased its forecast from 1.9% to 2.5%, up by 0.6 percentage points.

Barclays raised its projection from 2.0% to 2.4%, up by 0.4 percentage points; Nomura slightly increased its forecast from 2.3% to 2.4%. Meanwhile, Bank of America (1.9%), HSBC (1.9%), and UBS (2.2%) maintained their original forecasts unchanged.

Analysts say the upward revisions by overseas IBs were influenced by the significantly stronger-than-expected first-quarter economic growth. The Bank of Korea released preliminary data showing a seasonally adjusted quarterly GDP growth rate of 1.7%.

Notably, some analysts argue that expanded investments in artificial intelligence (AI) are driving sustained improvements in chip exports, greatly increasing external expectations for South Korea’s economic recovery. At the beginning of January, the average forecast for full-year growth among IBs stood at 2.1%, surpassing both the Bank of Korea’s (1.8%) and the South Korean government’s (2%) projections.

Additionally, forecasts for South Korea’s economic growth next year have also seen a slight upward adjustment. At the end of March, the average forecast among the eight IBs stood at 2.0%; by the end of April, it had risen to 2.1%, an increase of 0.1 percentage point.

Furthermore, concerns over rising international oil prices due to the Middle East conflict have led to higher inflation expectations. At the end of March, the average forecast for South Korea’s consumer price index (CPI) growth stood at 2.4%; by the end of April, it rose to 2.5%, up by 0.1 percentage point. Similarly, next year’s inflation forecast climbed from 2.0% to 2.1% during the same period.

Source: Chosun Ilbo

Original article: toutiao.com/article/1864691306840076/

Disclaimer: The views expressed in this article are those of the author(s) alone.