First home buyers snap up bayside three-bedder for $1.77m
A St Kilda house in need of a little love sold at Saturday's auction for $300,000 over reserve after a first home buyer couple paid $1.765 million for the three-bedroom property.
With a price guide of $1.3 million to $1.4 million, the auction of 17 Fawkner Street attracted well over 40 onlookers and four serious bidders, who battled it out for nearly 15 minutes before victory was secured.
The reserve price was $1.46 million. There is no legal requirement for a vendor's reserve to be in line with their property's price guide.
The property was one of 1417 scheduled to go to auction in Melbourne this week. By evening, Domain Group recorded a preliminary auction clearance rate of 70.3 per cent from 1048 reported results throughout the week, while 105 auctions were withdrawn. Withdrawn auctions are counted as unsold properties when calculating the clearance rate.
Auctioneer Nick Renna took the bidders through a competitive session with an opening bid of $1.45 million, where two couples battled it out until the $1.725 million mark, at which point the third and fourth bidders stepped in.
Connor Delany from Jellis Craig Brighton said the winners, a couple with teenage children, were renting in Albert Park and had been on the lookout for their first property.
'Those buyers came from Barcelona, they've been here for about 15 years, and it's their first purchase,' he said. Most of the potential buyers were local, with many looking to 'renovate and live in the house, or flip it'.
'The house needs some TLC,' Delany said. The underbidders included a couple with nearby family, an upsizer in an apartment, and an older European man.
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The Advertiser
a day ago
- The Advertiser
Asia share markets, dollar wary on tariff news
Asian share markets have made a wary start to the week as investors navigate the shifting sands of White House tariff policy, while awaiting key US jobs data and a widely expected cut in European interest rates. There was little obvious reaction to President Donald Trump's threat late on Friday to double tariffs on imported steel and aluminium to 50 per cent, beginning on June 4, a sudden twist that drew the ire of European Union negotiators. Speaking on Sunday, Treasury Secretary Scott Bessent said Trump would soon speak with Chinese President Xi Jinping to iron out a dispute over critical minerals. White House officials continued to play down a court ruling that Trump had overstepped his authority by imposing across-the-board duties on imports from US trading partners. "The court ruling will complicate the path ahead on trade policy, but there remains an ample set of provisions available to the administration to deliver its desired results," said Bruce Kasman, chief economist at JPMorgan. "There is a commitment to maintaining a minimum US tariff rate of at least 10 per cent and imposing further sector tariff increases," he added. "An increase in ASEAN to discourage transhipment looks likely, and the bias for higher tariffs on US-EU trade persists." Markets will be particularly interested to see if Trump goes ahead with the 50 per cent tariff on Wednesday, or backs off as he has done so often before. In the meantime, caution reigned and MSCI's broadest index of Asia-Pacific shares outside Japan went flat. Japan's Nikkei fell 1.1 per cent on Monday, while South Korean stocks dipped 0.1 per cent. S&P 500 futures eased 0.2 per cent and Nasdaq futures lost 0.3 per cent. The S&P climbed 6.2 per cent in May, while the Nasdaq rallied 9.6 per cent on hopes final import levies will be far lower than the initial sky-high levels. Front-running the tariffs has already caused wild swings in the economy, with a contraction in the first quarter likely turning into a jump this quarter as imports fall back. The Atlanta Fed GDPNow estimate is running at an annualised 3.8 per cent, though analysts assume this will slow sharply in the second half of the year. Data this week on US manufacturing and jobs will offer a timely reading on the pulse of activity, with payrolls seen rising 130,000 in May while unemployment stays at 4.2 per cent. A rise in unemployment is one of the few developments that could get the Federal Reserve to start thinking of easing policy again, with investors having largely given up on a cut this month or next. A move in September is seen at around a 75 per cent chance, though Fed officials have stopped well short of endorsing such pricing. There are at least 11 Fed speakers on the diary for this week, led by Fed Chair Jerome Powell later on Monday. Fed Governor Christopher Waller said on Sunday that cuts remain possible later this year as he saw downside risks to economic activity and employment and upside risks to inflation from the tariffs. A softer jobs report would be a relief for the Treasury market, where 30-year yields continue to flirt with the five per cent barrier as investors demand a higher premium to offset the ever-expanding supply of debt. The Senate this week will start considering a tax-and-spending bill that will add an estimated $US3.8 trillion ($A5.9 trillion) to the federal government's $US36.2 trillion ($A56.3 trillion) in debt. Across the Atlantic, the European Central Bank is considered almost certain to cut its rates by a quarter point to 2.0 per cent on Thursday, while markets will be sensitive to guidance on the chance of another move as early as July. The Bank of Canada meets Wednesday and markets imply a 76 per cent chance it will hold rates at 2.75 per cent, while sounding dovish on the future given the tariff-fuelled risk of recession there. Widening rate spreads have so far offered only limited support to the US dollar. "The greenback remains near the lower end of its post-2022 range and considerably weaker than interest rate differentials would imply," noted Jonas Goltermann, deputy chief markets economist at Capital Economics. "Sentiment around the greenback remains negative and it continues to look vulnerable to further bad news on the fiscal and trade policy fronts." On Monday, the dollar had dipped 0.2 per cent on the yen to $143.79 , while the euro edged up a fraction to $1.1353 . The greenback also slipped 0.1 per cent on the Canadian dollar to $1.3727, getting no tailwind from Trump's threat of 50 per cent tariffs on Canadian steel exports. In commodity markets, gold edged up 0.6 per cent to $US3310 ($A5,147) an ounce , having lost 1.9 per cent last week. Oil prices bounced after OPEC+ decided to increase output in July by the same amount as it did in each of the prior two months, a relief to some who had feared an even bigger increase. Brent rose $US1.07 ($A1.66) to $US63.85 ($A99.28) a barrel, while US crude gained $US1.18 ($A1.83) to $US61.95 ($A96.33) per barrel. Asian share markets have made a wary start to the week as investors navigate the shifting sands of White House tariff policy, while awaiting key US jobs data and a widely expected cut in European interest rates. There was little obvious reaction to President Donald Trump's threat late on Friday to double tariffs on imported steel and aluminium to 50 per cent, beginning on June 4, a sudden twist that drew the ire of European Union negotiators. Speaking on Sunday, Treasury Secretary Scott Bessent said Trump would soon speak with Chinese President Xi Jinping to iron out a dispute over critical minerals. White House officials continued to play down a court ruling that Trump had overstepped his authority by imposing across-the-board duties on imports from US trading partners. "The court ruling will complicate the path ahead on trade policy, but there remains an ample set of provisions available to the administration to deliver its desired results," said Bruce Kasman, chief economist at JPMorgan. "There is a commitment to maintaining a minimum US tariff rate of at least 10 per cent and imposing further sector tariff increases," he added. "An increase in ASEAN to discourage transhipment looks likely, and the bias for higher tariffs on US-EU trade persists." Markets will be particularly interested to see if Trump goes ahead with the 50 per cent tariff on Wednesday, or backs off as he has done so often before. In the meantime, caution reigned and MSCI's broadest index of Asia-Pacific shares outside Japan went flat. Japan's Nikkei fell 1.1 per cent on Monday, while South Korean stocks dipped 0.1 per cent. S&P 500 futures eased 0.2 per cent and Nasdaq futures lost 0.3 per cent. The S&P climbed 6.2 per cent in May, while the Nasdaq rallied 9.6 per cent on hopes final import levies will be far lower than the initial sky-high levels. Front-running the tariffs has already caused wild swings in the economy, with a contraction in the first quarter likely turning into a jump this quarter as imports fall back. The Atlanta Fed GDPNow estimate is running at an annualised 3.8 per cent, though analysts assume this will slow sharply in the second half of the year. Data this week on US manufacturing and jobs will offer a timely reading on the pulse of activity, with payrolls seen rising 130,000 in May while unemployment stays at 4.2 per cent. A rise in unemployment is one of the few developments that could get the Federal Reserve to start thinking of easing policy again, with investors having largely given up on a cut this month or next. A move in September is seen at around a 75 per cent chance, though Fed officials have stopped well short of endorsing such pricing. There are at least 11 Fed speakers on the diary for this week, led by Fed Chair Jerome Powell later on Monday. Fed Governor Christopher Waller said on Sunday that cuts remain possible later this year as he saw downside risks to economic activity and employment and upside risks to inflation from the tariffs. A softer jobs report would be a relief for the Treasury market, where 30-year yields continue to flirt with the five per cent barrier as investors demand a higher premium to offset the ever-expanding supply of debt. The Senate this week will start considering a tax-and-spending bill that will add an estimated $US3.8 trillion ($A5.9 trillion) to the federal government's $US36.2 trillion ($A56.3 trillion) in debt. Across the Atlantic, the European Central Bank is considered almost certain to cut its rates by a quarter point to 2.0 per cent on Thursday, while markets will be sensitive to guidance on the chance of another move as early as July. The Bank of Canada meets Wednesday and markets imply a 76 per cent chance it will hold rates at 2.75 per cent, while sounding dovish on the future given the tariff-fuelled risk of recession there. Widening rate spreads have so far offered only limited support to the US dollar. "The greenback remains near the lower end of its post-2022 range and considerably weaker than interest rate differentials would imply," noted Jonas Goltermann, deputy chief markets economist at Capital Economics. "Sentiment around the greenback remains negative and it continues to look vulnerable to further bad news on the fiscal and trade policy fronts." On Monday, the dollar had dipped 0.2 per cent on the yen to $143.79 , while the euro edged up a fraction to $1.1353 . The greenback also slipped 0.1 per cent on the Canadian dollar to $1.3727, getting no tailwind from Trump's threat of 50 per cent tariffs on Canadian steel exports. In commodity markets, gold edged up 0.6 per cent to $US3310 ($A5,147) an ounce , having lost 1.9 per cent last week. Oil prices bounced after OPEC+ decided to increase output in July by the same amount as it did in each of the prior two months, a relief to some who had feared an even bigger increase. Brent rose $US1.07 ($A1.66) to $US63.85 ($A99.28) a barrel, while US crude gained $US1.18 ($A1.83) to $US61.95 ($A96.33) per barrel. Asian share markets have made a wary start to the week as investors navigate the shifting sands of White House tariff policy, while awaiting key US jobs data and a widely expected cut in European interest rates. There was little obvious reaction to President Donald Trump's threat late on Friday to double tariffs on imported steel and aluminium to 50 per cent, beginning on June 4, a sudden twist that drew the ire of European Union negotiators. Speaking on Sunday, Treasury Secretary Scott Bessent said Trump would soon speak with Chinese President Xi Jinping to iron out a dispute over critical minerals. White House officials continued to play down a court ruling that Trump had overstepped his authority by imposing across-the-board duties on imports from US trading partners. "The court ruling will complicate the path ahead on trade policy, but there remains an ample set of provisions available to the administration to deliver its desired results," said Bruce Kasman, chief economist at JPMorgan. "There is a commitment to maintaining a minimum US tariff rate of at least 10 per cent and imposing further sector tariff increases," he added. "An increase in ASEAN to discourage transhipment looks likely, and the bias for higher tariffs on US-EU trade persists." Markets will be particularly interested to see if Trump goes ahead with the 50 per cent tariff on Wednesday, or backs off as he has done so often before. In the meantime, caution reigned and MSCI's broadest index of Asia-Pacific shares outside Japan went flat. Japan's Nikkei fell 1.1 per cent on Monday, while South Korean stocks dipped 0.1 per cent. S&P 500 futures eased 0.2 per cent and Nasdaq futures lost 0.3 per cent. The S&P climbed 6.2 per cent in May, while the Nasdaq rallied 9.6 per cent on hopes final import levies will be far lower than the initial sky-high levels. Front-running the tariffs has already caused wild swings in the economy, with a contraction in the first quarter likely turning into a jump this quarter as imports fall back. The Atlanta Fed GDPNow estimate is running at an annualised 3.8 per cent, though analysts assume this will slow sharply in the second half of the year. Data this week on US manufacturing and jobs will offer a timely reading on the pulse of activity, with payrolls seen rising 130,000 in May while unemployment stays at 4.2 per cent. A rise in unemployment is one of the few developments that could get the Federal Reserve to start thinking of easing policy again, with investors having largely given up on a cut this month or next. A move in September is seen at around a 75 per cent chance, though Fed officials have stopped well short of endorsing such pricing. There are at least 11 Fed speakers on the diary for this week, led by Fed Chair Jerome Powell later on Monday. Fed Governor Christopher Waller said on Sunday that cuts remain possible later this year as he saw downside risks to economic activity and employment and upside risks to inflation from the tariffs. A softer jobs report would be a relief for the Treasury market, where 30-year yields continue to flirt with the five per cent barrier as investors demand a higher premium to offset the ever-expanding supply of debt. The Senate this week will start considering a tax-and-spending bill that will add an estimated $US3.8 trillion ($A5.9 trillion) to the federal government's $US36.2 trillion ($A56.3 trillion) in debt. Across the Atlantic, the European Central Bank is considered almost certain to cut its rates by a quarter point to 2.0 per cent on Thursday, while markets will be sensitive to guidance on the chance of another move as early as July. The Bank of Canada meets Wednesday and markets imply a 76 per cent chance it will hold rates at 2.75 per cent, while sounding dovish on the future given the tariff-fuelled risk of recession there. Widening rate spreads have so far offered only limited support to the US dollar. "The greenback remains near the lower end of its post-2022 range and considerably weaker than interest rate differentials would imply," noted Jonas Goltermann, deputy chief markets economist at Capital Economics. "Sentiment around the greenback remains negative and it continues to look vulnerable to further bad news on the fiscal and trade policy fronts." On Monday, the dollar had dipped 0.2 per cent on the yen to $143.79 , while the euro edged up a fraction to $1.1353 . The greenback also slipped 0.1 per cent on the Canadian dollar to $1.3727, getting no tailwind from Trump's threat of 50 per cent tariffs on Canadian steel exports. In commodity markets, gold edged up 0.6 per cent to $US3310 ($A5,147) an ounce , having lost 1.9 per cent last week. Oil prices bounced after OPEC+ decided to increase output in July by the same amount as it did in each of the prior two months, a relief to some who had feared an even bigger increase. Brent rose $US1.07 ($A1.66) to $US63.85 ($A99.28) a barrel, while US crude gained $US1.18 ($A1.83) to $US61.95 ($A96.33) per barrel. Asian share markets have made a wary start to the week as investors navigate the shifting sands of White House tariff policy, while awaiting key US jobs data and a widely expected cut in European interest rates. There was little obvious reaction to President Donald Trump's threat late on Friday to double tariffs on imported steel and aluminium to 50 per cent, beginning on June 4, a sudden twist that drew the ire of European Union negotiators. Speaking on Sunday, Treasury Secretary Scott Bessent said Trump would soon speak with Chinese President Xi Jinping to iron out a dispute over critical minerals. White House officials continued to play down a court ruling that Trump had overstepped his authority by imposing across-the-board duties on imports from US trading partners. "The court ruling will complicate the path ahead on trade policy, but there remains an ample set of provisions available to the administration to deliver its desired results," said Bruce Kasman, chief economist at JPMorgan. "There is a commitment to maintaining a minimum US tariff rate of at least 10 per cent and imposing further sector tariff increases," he added. "An increase in ASEAN to discourage transhipment looks likely, and the bias for higher tariffs on US-EU trade persists." Markets will be particularly interested to see if Trump goes ahead with the 50 per cent tariff on Wednesday, or backs off as he has done so often before. In the meantime, caution reigned and MSCI's broadest index of Asia-Pacific shares outside Japan went flat. Japan's Nikkei fell 1.1 per cent on Monday, while South Korean stocks dipped 0.1 per cent. S&P 500 futures eased 0.2 per cent and Nasdaq futures lost 0.3 per cent. The S&P climbed 6.2 per cent in May, while the Nasdaq rallied 9.6 per cent on hopes final import levies will be far lower than the initial sky-high levels. Front-running the tariffs has already caused wild swings in the economy, with a contraction in the first quarter likely turning into a jump this quarter as imports fall back. The Atlanta Fed GDPNow estimate is running at an annualised 3.8 per cent, though analysts assume this will slow sharply in the second half of the year. Data this week on US manufacturing and jobs will offer a timely reading on the pulse of activity, with payrolls seen rising 130,000 in May while unemployment stays at 4.2 per cent. A rise in unemployment is one of the few developments that could get the Federal Reserve to start thinking of easing policy again, with investors having largely given up on a cut this month or next. A move in September is seen at around a 75 per cent chance, though Fed officials have stopped well short of endorsing such pricing. There are at least 11 Fed speakers on the diary for this week, led by Fed Chair Jerome Powell later on Monday. Fed Governor Christopher Waller said on Sunday that cuts remain possible later this year as he saw downside risks to economic activity and employment and upside risks to inflation from the tariffs. A softer jobs report would be a relief for the Treasury market, where 30-year yields continue to flirt with the five per cent barrier as investors demand a higher premium to offset the ever-expanding supply of debt. The Senate this week will start considering a tax-and-spending bill that will add an estimated $US3.8 trillion ($A5.9 trillion) to the federal government's $US36.2 trillion ($A56.3 trillion) in debt. Across the Atlantic, the European Central Bank is considered almost certain to cut its rates by a quarter point to 2.0 per cent on Thursday, while markets will be sensitive to guidance on the chance of another move as early as July. The Bank of Canada meets Wednesday and markets imply a 76 per cent chance it will hold rates at 2.75 per cent, while sounding dovish on the future given the tariff-fuelled risk of recession there. Widening rate spreads have so far offered only limited support to the US dollar. "The greenback remains near the lower end of its post-2022 range and considerably weaker than interest rate differentials would imply," noted Jonas Goltermann, deputy chief markets economist at Capital Economics. "Sentiment around the greenback remains negative and it continues to look vulnerable to further bad news on the fiscal and trade policy fronts." On Monday, the dollar had dipped 0.2 per cent on the yen to $143.79 , while the euro edged up a fraction to $1.1353 . The greenback also slipped 0.1 per cent on the Canadian dollar to $1.3727, getting no tailwind from Trump's threat of 50 per cent tariffs on Canadian steel exports. In commodity markets, gold edged up 0.6 per cent to $US3310 ($A5,147) an ounce , having lost 1.9 per cent last week. Oil prices bounced after OPEC+ decided to increase output in July by the same amount as it did in each of the prior two months, a relief to some who had feared an even bigger increase. Brent rose $US1.07 ($A1.66) to $US63.85 ($A99.28) a barrel, while US crude gained $US1.18 ($A1.83) to $US61.95 ($A96.33) per barrel.
Sydney Morning Herald
a day ago
- Sydney Morning Herald
Why did Trump double his steel tariffs? Because he could
Apart from trying to show that he still has some, albeit more limited, authority to act on tariffs, Trump's announcement, to a rally of US steelworks, had a secondary purpose. Loading During last year's election campaign, Trump was vehemently opposed to a proposed $US15 billion ($23.3 billion) acquisition of US Steel by Japan's Nippon Steel - as was Joe Biden, who blocked the deal only days before he left office. Both were chasing the votes of steelworkers and their powerful union in the critical swing state of Pennsylvania, where US Steel is headquartered and has its major plants. Having won the election, however, Trump has had a change of mind. While the US will impose some significant conditions on the deal -- including, perhaps, a 'golden share' that would give the government a veto over major decisions along with a commitment from Nippon Steel to appoint a US chief executive and a majority of Americans to the board – it now appears that he will approve the deal, even though he says he hasn't seen its final details. Nippon Steel, one of the world's most sophisticated steel producers, has promised to invest about $US14 billion in US Steel's operations, which have been struggling, shrinking and suffering from under-investment for decades. Trump's doubling of the tariff rate for steel and aluminium is a way of justifying the decision to approve the deal, as well as enhancing the economics of US Steel and other US steelmakers and helping to underwrite Nippon Steel's massive investments, most of which will occur over the next four years. Trump's original tariffs on steel and aluminium infuriated America's trade partners, including Australia, even though Australia's exports of those metals to the US are quite modest. Canada, whose steel exports represent about a quarter of US steel imports and half its aluminium imports, has far more at stake. Mexico, Brazil, South Korea, Vietnam, Japan and European nations will also be impacted, with Canada and the European Union already threatening retaliation, as they did in response to Trump's initial 25 per cent tariffs. Australia is still, probably fruitlessly, seeking an exemption. Loading The decision to allow the Nippon Streel deal to proceed, if that is the final outcome, is good policy. The US steel industry is small – about half the size it was half a century ago -- and has been shrinking. It has poor profitability and ageing technology. Nippon Steel's investment and its technologies can arrest that decline. The decision to double the tariffs on steel – indeed the original decision to impose the 25 per cent tariff – is, however, poor policy. It will increase investment in the sector, and will probably improve its profitability, plant utilisation rates and employment numbers. But that will come at a significant cost. In 2018, when Trump first imposed tariffs on imported steel, steel prices rose almost 10 per cent, the sector's profits rose by about $US2.5 billion, capacity utilisation jumped from 74 per cent to about 80 per cent and nearly 10,000 jobs were added within the sector. The impact was quite short-lived, with those numbers subsequently reversing as the industry resumed its long-term decline. The initial impact was predictable. Tariffs are protectionist. They protect domestic industries and companies from more efficient producers elsewhere by boosting their sales, margins and profits. That's what happened after the 2018 tariffs. Loading They come, however, at a cost to the customers of the protected industries, which is also what happened after Trump's 2018 tariffs were imposed. A Peterson Institute for International Economics study concluded that the 2018 tariffs cost US downstream steel-using industries about $US5.6 billion, or about $US650,000 for each new job they added in the steel sector. The US Federal Reserve Board concluded that they cost about 75,000 jobs in those downstream industries, or more than eight times the number of jobs added by the steelmakers. Steel is a key input to the manufacturing industries, whose protection Trump has trumpeted as the rationale for his trade wars. It's also extensively used in the construction sector. With the 25 per cent version of the tariffs on steel and aluminium not only set at twice the 2018 rate, but also applying more broadly – they now also extend to downstream products containing the metals – their impact on steel and aluminium users and US companies and consumers will be far more significant and damaging. Trump might regain a little of the authority and ego he lost when the court knocked out, perhaps temporarily, his broader weaponisation of tariffs against the rest of the world. He might also have ingratiated himself with the steelworkers whose jobs he will protect, but the economic benefits of his metals tariffs will be far outweighed by their costs to the rest of the US economy. The probable impact on the steel and aluminium industries and their customers provide, in fact, a glimpse of the broader damage that Trump's trade wars on everyone – if the courts allow him to continue them, or he can find other means to implement them – will inflict on the world's largest economy.
The Age
a day ago
- The Age
Why did Trump double his steel tariffs? Because he could
Apart from trying to show that he still has some, albeit more limited, authority to act on tariffs, Trump's announcement, to a rally of US steelworks, had a secondary purpose. Loading During last year's election campaign, Trump was vehemently opposed to a proposed $US15 billion ($23.3 billion) acquisition of US Steel by Japan's Nippon Steel - as was Joe Biden, who blocked the deal only days before he left office. Both were chasing the votes of steelworkers and their powerful union in the critical swing state of Pennsylvania, where US Steel is headquartered and has its major plants. Having won the election, however, Trump has had a change of mind. While the US will impose some significant conditions on the deal -- including, perhaps, a 'golden share' that would give the government a veto over major decisions along with a commitment from Nippon Steel to appoint a US chief executive and a majority of Americans to the board – it now appears that he will approve the deal, even though he says he hasn't seen its final details. Nippon Steel, one of the world's most sophisticated steel producers, has promised to invest about $US14 billion in US Steel's operations, which have been struggling, shrinking and suffering from under-investment for decades. Trump's doubling of the tariff rate for steel and aluminium is a way of justifying the decision to approve the deal, as well as enhancing the economics of US Steel and other US steelmakers and helping to underwrite Nippon Steel's massive investments, most of which will occur over the next four years. Trump's original tariffs on steel and aluminium infuriated America's trade partners, including Australia, even though Australia's exports of those metals to the US are quite modest. Canada, whose steel exports represent about a quarter of US steel imports and half its aluminium imports, has far more at stake. Mexico, Brazil, South Korea, Vietnam, Japan and European nations will also be impacted, with Canada and the European Union already threatening retaliation, as they did in response to Trump's initial 25 per cent tariffs. Australia is still, probably fruitlessly, seeking an exemption. Loading The decision to allow the Nippon Streel deal to proceed, if that is the final outcome, is good policy. The US steel industry is small – about half the size it was half a century ago -- and has been shrinking. It has poor profitability and ageing technology. Nippon Steel's investment and its technologies can arrest that decline. The decision to double the tariffs on steel – indeed the original decision to impose the 25 per cent tariff – is, however, poor policy. It will increase investment in the sector, and will probably improve its profitability, plant utilisation rates and employment numbers. But that will come at a significant cost. In 2018, when Trump first imposed tariffs on imported steel, steel prices rose almost 10 per cent, the sector's profits rose by about $US2.5 billion, capacity utilisation jumped from 74 per cent to about 80 per cent and nearly 10,000 jobs were added within the sector. The impact was quite short-lived, with those numbers subsequently reversing as the industry resumed its long-term decline. The initial impact was predictable. Tariffs are protectionist. They protect domestic industries and companies from more efficient producers elsewhere by boosting their sales, margins and profits. That's what happened after the 2018 tariffs. Loading They come, however, at a cost to the customers of the protected industries, which is also what happened after Trump's 2018 tariffs were imposed. A Peterson Institute for International Economics study concluded that the 2018 tariffs cost US downstream steel-using industries about $US5.6 billion, or about $US650,000 for each new job they added in the steel sector. The US Federal Reserve Board concluded that they cost about 75,000 jobs in those downstream industries, or more than eight times the number of jobs added by the steelmakers. Steel is a key input to the manufacturing industries, whose protection Trump has trumpeted as the rationale for his trade wars. It's also extensively used in the construction sector. With the 25 per cent version of the tariffs on steel and aluminium not only set at twice the 2018 rate, but also applying more broadly – they now also extend to downstream products containing the metals – their impact on steel and aluminium users and US companies and consumers will be far more significant and damaging. Trump might regain a little of the authority and ego he lost when the court knocked out, perhaps temporarily, his broader weaponisation of tariffs against the rest of the world. He might also have ingratiated himself with the steelworkers whose jobs he will protect, but the economic benefits of his metals tariffs will be far outweighed by their costs to the rest of the US economy. The probable impact on the steel and aluminium industries and their customers provide, in fact, a glimpse of the broader damage that Trump's trade wars on everyone – if the courts allow him to continue them, or he can find other means to implement them – will inflict on the world's largest economy.
