An NBC News Special Report will appear live in the player above just as the president prepares to begin his speech. Watch live
President Donald Trump is set to announce a barrage of tariffs Wednesday in what he is calling “Liberation Day” for the U.S.
The new tariffs — which apply to friend and foe alike— are a bid to boost U.S. manufacturing and punish other countries for what he has said are years of unfair trade practices. But by most economists’ assessments, the risky move threatens to plunge the economy into a downturn and mangle decades-old alliances.
“This is the beginning of Liberation Day in America,” Trump said earlier this week. “We’re going to charge countries for doing business in our country and taking our jobs, taking our wealth, taking a lot of things that they’ve been taking over the years. They’ve taken so much out of our country, friend and foe. And, frankly, friend has been oftentimes much worse than foe.”
Here’s what you should know about the impending trade penalties:
What time will Trump make his tariff announcement?
Trump is scheduled to make an announcement from the White House Rose Garden at 3 p.m. CT. Watch live in the player above.
What will happen on “Liberation Day”?
The president wants to announce import taxes, including “reciprocal” tariffs that would match the rates charged by other countries and account for other subsidies. Trump has talked about taxing the European Union, South Korea, Brazil and India, among other countries.
As he announced 25% auto tariffs last week, he alleged that America has been ripped off because it imports more goods than it exports. In an interview Saturday with NBC News, Trump said it did not bother him if tariffs caused vehicle prices to rise because autos with more U.S. content could possibly be more competitively priced.
“I hope they raise their prices, because if they do, people are gonna buy American-made cars,” Trump said. “I couldn’t care less because if the prices on foreign cars go up, they’re going to buy American cars.”
Trump has also suggested that he will be flexible with his tariffs, saying he will treat other nations better than they treated the United States. But he still has plenty of other taxes coming on imports.
The Republican president plans to tax imported pharmaceutical drugs, copper and lumber.
He has put forth a 25% tariff on any country that imports oil from Venezuela, even though the United States also does so. Imports from China are being charged an additional 20% tax because of its role in fentanyl production. Trump has imposed separate tariffs on goods from Canada and Mexico for the stated reason of stopping drug smuggling and illegal immigration. Trump also expanded his 2018 steel and aluminum tariffs to 25% on all imports.
Some aides suggest the tariffs are tools for negotiation on trade and border security; others say the revenues will help reduce the federal budget deficit. Commerce Secretary Howard Lutnick says they will force other nations to show Trump “respect.”
But the details of Trump’s next round of import taxes are still full of questions.
Most economic analyses say average U.S. families would have to absorb the cost of his tariffs in the form of higher prices and lower incomes. But an undeterred Trump is inviting CEOs to the White House to say they are investing hundreds of billions of dollars in new projects to avoid the import taxes.
It is also possible that the tariffs are short-lived if Trump feels he can cut a deal after imposing them.
“I’m certainly open to it, if we can do something,” Trump told reporters. “We’ll get something for it.”
What are lawmakers saying?
Senate Republicans are facing pressure Wednesday from Trump to oppose the Democratic resolution that would nullify the presidential emergency on fentanyl he’s using to implement tariffs on Canada.
Just hours before Trump was set to announce his plan, the Senate was expected to vote on a resolution that offers Republicans an off-ramp to the import taxes on Canada. It’s a significant test for Republican loyalty to Trump’s vision of remaking the U.S. economy by clamping down on free trade. Many economists are warning the plan could force an economic contraction and GOP senators are already watching with unease.
The votes of at least four Republicans — Sens. Lisa Murkowski of Alaska, Susan Collins of Maine, Mitch McConnell of Kentucky and Rand Paul of Kentucky — were in doubt ahead of the vote.
Meanwhile, a number of congressional Republicans are publicly voicing concern over the potential for a prolonged trade war and its effect on American farmers.
House Agriculture Committee chair Glenn Thompson, R-Pa., told NBC News that he has asked the White House to exempt certain goods that are important to the U.S. agricultural industry, such as fertilizer and peat moss.
“I’ve kind of pointed out the things that I’m hoping will be excluded,” he said. “I talk with anybody who will listen to me. … They’ve been really good about input.”
Thompson also said he hopes Congress won’t need to bail out farmers with an emergency aid package, as it did during the first Trump administration. But, he said, “we’ll be prepared to do that” again if needed.
What could this mean for the US economy?
Economists say the tariffs could get passed along to consumers in the form of higher prices for autos, groceries, housing and other goods. Corporate profits could be lower and growth more sluggish. Trump maintains that more companies would open factories to avoid the taxes, though that process could take three years or more.
U.S. stocks are swinging sharply Wednesday in the final hours before Trump unveiled the tariffs he promised.
The S&P 500 was virtually unchanged in late trading, but only after careening between an earlier loss of 1.1% and a later gain of 1.1%. It’s had a pattern this week of opening with sharp drops only to finish the day higher.
The Dow Jones Industrial Average was up 31 points, or 0.1%, with an hour remaining in trading, and the Nasdaq composite was 0.3% higher. Both also veered from sharply lower in the morning to sharply higher in the afternoon and then doubled back.
Economist Art Laffer estimates the tariffs on autos, if fully implemented, could increase per vehicle costs by $4,711, though he said he views Trump as a smart and savvy negotiator. The investment bank Goldman Sachs estimates the economy will grow this quarter at an annual rate of just 0.6%, down from a rate of 2.4% at the end of last year.
Mayor Andrew Ginther of Columbus, Ohio, said on Friday that tariffs could increase the median cost of a home by $21,000, making affordability more of an obstacle because building materials would cost more.
White House trade adviser Peter Navarro told “Fox News Sunday” that the auto tariffs would raise $100 billion annually and the other tariffs would bring in about $600 billion per year, or about $6 trillion over 10 years. As a share of the economy, that would be the largest tax increase since World War II, according to Jessica Riedl, a senior fellow at the Manhattan Institute, a conservative think tank.
Treasury Secretary Scott Bessent has suggested that tariffs would be a one-time price adjustment, rather than the start of an inflationary spiral. But Bessent’s conclusion rests on tariffs being brief or contained, rather than leading other countries to retaliate with their own tariffs or seeping into other sectors of the economy.
“There is a chance tariffs on goods begin to filter through to the pricing of services,” said Samuel Rines, a strategist at WisdomTree. “Auto parts get move expensive, then auto repair gets more expensive, then auto insurance feels the pressure. While goods are the focus, tariffs could have a longer-term effect on inflation.”
At Goldman Sachs, economists raised their forecast for inflation and lowered it for U.S. economic growth for the end of the year.
They now see a 35% chance of recession in the next year, up from an earlier forecast of 20%, “reflecting our lower growth forecast, falling confidence, and statements from White House officials indicating willingness to tolerate economic pain,” according to Goldman Sachs economist David Mericle.
If the April 2 tariffs end up being less onerous than investors fear — maybe Trump includes no additional tariff increases on China, for example — stocks could rally. But if they end up being a worst-case scenario, which gets businesses so fearful that they start cutting their workforces, stocks could sink much further.
Of course, there’s also the chance that April 2 does little to clear the uncertainty. It could end up being a “stepping stone for further negotiations” instead of a “clearing event” for the market, according to Michael Wilson and other strategists at Morgan Stanley.
“This means policy uncertainty and growth risks are likely to persist — it’s a question of to what degree,” Wilson wrote in a report.
One worry is that even if Trump’s tariffs end up being less harsh than feared, all the uncertainty created by them alone could cause U.S. households and businesses to freeze their spending, which would hurt an economy that had been running at a solid pace to close last year.
Why is Trump calling it ‘Liberation Day’?
Based off Trump’s public statements, April 2 is at least the third “liberation day” that he has identified.
At a rally last year in Nevada, he said the day of the presidential election, Nov. 5, would be “Liberation Day in America.” He later gave his inauguration the same label, declaring in his address: “For American citizens, Jan. 20, 2025, is Liberation Day.”
His repeated designation of the term is a sign of just how much importance Trump places on tariffs, an obsession of his since the 1980s. Dozens of other countries recognize their own form of liberation days to recognize events such as overcoming Nazi Germany or the end of a previous political regime deemed oppressive.
Trump sees his tariffs as providing national redemption, but the slumping consumer confidence and stock market indicate that much of the public believes the U.S. economy will pay the price for his ambitions.
“I don’t see anything positive about Liberation Day,” said Phillip Braun, a finance professor at Northwestern University’s Kellogg School of Management. “It’s going to hurt the U.S. economy. Other countries are going to retaliate.”
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