President Donald Trump’s decision to impose a 25% tariff on all steel and aluminum imports has been hailed as a significant win for the U.S. steel industry. While the move is intended to bolster domestic production and reduce reliance on foreign metals, its broader economic impact is more complex. The tariff is poised to ripple across various industries, potentially driving up manufacturing costs and creating volatility in financial markets.
Let’s take a closer look at how this new steel and aluminum tariff could impact various sectors.
Trump’s new tariff has escalated global tensions, prompting investors to seek safe havens. As a result, gold prices soared to a fresh all-time high on Tuesday, approaching the $3,000 mark for the first time in history. Additionally, gold exchange-traded funds also reached an all-time high after experiencing their longest winning streak since 2020. There is little doubt that the ongoing tariff tensions will drive gold prices even higher.
The American steel industry has advocated for steel tariffs for decades, winning support from former Presidents Ronald Reagan, Jimmy Carter, and George W. Bush, to name a few. During his first term, and now in his second, Trump appears to be following the trend.
While the tariff will boost production and jobs within the steel and aluminum industry, it does not guarantee that the prices of steel and aluminum will not increase. This is because the U.S. has relied on imports of steel and aluminum for many years. In 2023, the U.S. International Trade Commission reported that the tariffs increased steel and aluminum prices by an average of 2.4% and 1.6%, respectively.
If you’re considering buying a home or investing in real estate, it’s important to be aware of the potential impact of tariffs on construction costs. A 25% tariff on all steel and aluminum imports is expected to drive up prices, as these metals play a crucial role in building infrastructure.
Steel is widely used in structural frameworks, reinforcements, and roofing, while aluminum is essential for windows, doors, and various finishing elements. As a result, higher material costs could lead to increased home prices, making real estate investments more expensive in the near future.
Ford (F) CEO Jim Farley said on Tuesday that President Donald Trump’s tariffs are causing significant costs and disruptions in the auto industry.
The anxiety within the auto industry stems from the extensive use of steel and aluminum in car manufacturing. These materials are fundamental to vehicle production, forming the backbone of structural design, interiors, and various essential components.
A report by CBS MoneyWatch (PARA) cited an expert who noted that a typical car contains approximately 1,000 pounds of steel, which costs between $6,000 and $7,000 per vehicle. According to the expert, adding a 25% tariff could increase the cost of a car by $1,000 to $1,500.
The impact of tariffs on steel and aluminum imports is likely to raise prices across manufacturing sectors, as these metals are essential to production, supply chains, and industrial applications. The U.S. economy is already facing production struggles and inflationary pressures, and such a decision would tighten the situation further.
–William Gavin contributed to this article
The post 5 sectors facing price hikes from Trump’s new steel and aluminum tariffs appeared first on Quartz.
