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US President Donald Trump announced tariffs on imports from Canada and Mexico, as well as additional tariffs on China, which are set to take effect on Tuesday, though the president announced on Monday a one-month delay for tariffs on Mexico.
Mizuho Americas US chief economist Steven Ricchiuto joins Morning Brief co-hosts Seana Smith and Brad Smith to discuss the impacts that Trump's tariffs could have on the US, Canadian, and Mexican economies.
"The inflationary aspects have been somewhat overplayed," Ricchiuto says. "The 2018 tariffs didn't have the effect everyone thought it had ... we have a global economy which is substantially weaker today than it was in 2018, we have a greater degree of excess supply, a greater degree of global disinflationary environment."
"We've had inflation remaining very, very benign in an environment where the Federal Reserve has shifted its focus away from inflation to maximizing full employment, and you have a currency that is appreciating," he explains. "There's a combination of margins and currency that will wind up absorbing a vast portion of the adjustment in prices."
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Watch the video above to hear more about Ricchiuto's thoughts on Trump's tariff policies and the Fed's next move.
To watch more expert insights and analysis on the latest market action, check out more Morning Brief here.
This post was written by Naomi Buchanan.