Megan O'Brien: Diageo shares rose 7% after its latest results - it's too early to toast a recovery
• What Diageo's new interim CEO had to say about $200m in Trump tariffs — and how they plan to cushion the blow
• How alcohol-free brands like Guinness 0.0 and Captain Morgan 0.0 are quietly driving double-digit growth
• Why the promise of a new CEO by October gave investors a rare shot of confidence
Shares in drinks giant Diageo rose almost 7 per cent on Tuesday morning.
It's worth noting the gain was the Guinness-owner's biggest rally - on ...
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Irish Examiner
a few seconds ago
- Irish Examiner
Trump's broad tariffs go into effect
President Donald Trump was set to officially begin levying higher import taxes on dozens of countries on Thursday, just as the economic fallout of his months-long tariff threats has begun to create visible damage for the US economy. The White House said that starting just after midnight, goods from more than 60 countries and the European Union (EU) would face tariff rates of 10% or higher. Products from the EU, Japan and South Korea will be taxed at 15%, while imports from Taiwan, Vietnam and Bangladesh will be taxed at 20%. President Donald Trump in the Oval Office in Washington (Alex Brandon/AP) For places such as the EU, Japan and South Korea, Mr Trump also expects them to invest hundreds of billions of dollars in the US. 'I think the growth is going to be unprecedented,' Mr Trump said on Wednesday afternoon. He added that the US was 'taking in hundreds of billions of dollars in tariffs', but he could not provide a specific figure for revenues because 'we don't even know what the final number is' regarding tariff rates. Despite the uncertainty, the Trump White House is confident that the onset of his broad tariffs will provide clarity about the path of the world's largest economy. Now that companies understand the direction the US is headed, the administration believes it can ramp up new investments and jump-start hiring in ways that can rebalance the US economy as a manufacturing power. But so far, there are signs of self-inflicted wounds to America as companies and consumers alike brace for the impact of new taxes. What the data has shown is a US economy that changed in April with Mr Trump's initial rollout of tariffs, an event that led to market drama, a negotiating period and Mr Trump's ultimate decision to start his universal tariffs on Thursday. A customer shops in a grain isle at New India Bazar in Fremont, California, where most merchandise is imported from India and Canada (Noah Berger/AP) After April, economic reports show that hiring began to stall, inflationary pressures crept upward and home values in key markets started to decline, said John Silvia, chief executive of Dynamic Economic Strategy. 'A less productive economy requires fewer workers,' Mr Silvia said in an analysis note. 'But there is more, the higher tariff prices lower workers' real wages. The economy has become less productive, and firms cannot pay the same real wages as before. Actions have consequences.' Even then, the ultimate transformations of the tariffs are unknown and could play out over months, if not years. Many economists say the risk is that the American economy is steadily eroded rather than collapsing instantly. 'We all want it to be made for television where it's this explosion – it's not like that,' said Brad Jensen, a professor at Georgetown University. 'It's going to be fine sand in the gears and slow things down.' The Statue of Liberty is seen near Port Liberty Terminals in New York (Frank Franklin II/AP) Mr Trump has promoted the tariffs as a way to reduce the persistent trade deficit. But importers sought to avoid the taxes by importing more goods before the taxes went into effect. As a result, the 582.7 billion dollar trade imbalance for the first half of the year was 38% higher than in 2024. Total construction spending has dropped 2.9% over the past year. The lead-up to Thursday fit the slapdash nature of Mr Trump's tariffs, which have been variously rolled out, walked back, delayed, increased, imposed by letter and frantically renegotiated. The process has been so muddled that officials for key trade partners were unclear at the start of the week whether the tariffs would begin on Thursday or Friday. An employee counts US dollar notes at a money changer in Jakarta, Indonesia (Tatan Syuflana/AP) The language of the July 31 order to delay the start of tariffs from August 1 said the higher tax rates would start in seven days. On Wednesday morning, Kevin Hassett, director of the White House National Economic Council, was asked if the new tariffs began at midnight on Thursday, and he said reporters should check with the US Trade Representative's Office. Mr Trump on Wednesday announced additional 25% tariffs to be imposed on India for its buying of Russian oil, bringing its total import taxes to 50%. He has said that import taxes are still coming on pharmaceutical drugs and announced 100% tariffs on computer chips, meaning the US economy could remain in a place of suspended animation as it awaits the impact. The president's use of a 1977 law to declare an economic emergency to impose the tariffs is also under challenge. The impending ruling from last week's hearing before a US appeals court could cause Mr Trump to find other legal justifications if judges say he exceeded his authority. Even people who worked with Mr Trump during his first term are sceptical that things will go smoothly for the economy, such as Paul Ryan, the former Republican House of Representatives speaker, who has emerged as a Trump critic. Tropical spices are displayed for sale at a Presidente Supermarket in North Miami, Florida (Marta Lavandier/AP) 'There's no sort of rationale for this other than the president wanting to raise tariffs based upon his whims, his opinions,' Mr Ryan told CNBC on Wednesday. 'I think choppy waters are ahead because I think they're going to have some legal challenges.' Still, the stock market has been solid during the recent tariff drama, with the S&P 500 index climbing more than 25% from its April low. The market's rebound and the income tax cuts in Mr Trump's tax and spending measures signed into law on July 4 have given the White House confidence that economic growth is bound to accelerate in the coming months. As of now, Mr Trump still foresees an economic boom while the rest of the world and American voters wait nervously. 'There's one person who can afford to be cavalier about the uncertainty that he's creating, and that's Donald Trump,' said Rachel West, a senior fellow at The Century Foundation who worked in the Biden White House on labour policy. 'The rest of Americans are already paying the price for that uncertainty.'
Extra.ie
a few seconds ago
- Extra.ie
Ireland's record corporate tax take -- but don't tell Trump
The Exchequer looks on course for another year of bumper corporate tax receipts, despite threats of tariffs from the US. Latest Government figures show that the amount of tax collected from multinational firms located here was €1.2billion last month – a jump of €900million on July 2024. It is understood that a large, one-off payment brought about the increase. July's taking brings the total corporate tax amount collected so far this year to €14.3billion – which is €1.8billion ahead of the same period last year. Pic:US president Donald Trump this week namechecked Ireland as he pledged to introduce tariffs of up to 250% on pharmaceutical and semiconductor imports. But senior Government sources last night played down fears that the White House may use our strong corporation tax against Ireland, saying that they believe the framework agreement between the EU and US 'gives as much protection as could be hoped for'. However, they also said that the jump in corporation tax revenues highlights the 'highly volatile' nature of the income stream. The Government has taken in €58billion in taxes so far this year, up by €5.6billion on the same period last year. Pic: File When once-off tax revenues of €1.7billion arising from the Apple tax ruling are excluded, 'underlying' tax revenues stood at €56.2billion, a €3.9billion increase on last year. The increase in tax receipts is fuelled by rising corporation tax revenues. In a statement yesterday evening, the Department of Finance said that 'July is not ordinarily a significant month for corporation tax'. Nonetheless, receipts of €1.2billion were collected last month, 'a sharp increase of €0.9billion on July last year, underlining the exceptional month-to-month volatility in this highly concentrated revenue stream'. Pic: Gareth Chaney/Collins Photos Tax revenues across the board saw increases last month and remain ahead of 2024 levels. Income tax receipts rose by €100million year-on-year to €2.9billion in July. Non-tax revenue to the end of July was €2.3billion, up by €1.9billion on the same period last year, largely driven by transfers to the Exchequer of around €14billion from the Apple tax fund. Finance Minister Paschal Donohoe said tax revenues are broadly 'where we expected to be at this point in the year'. However, he added that the country should not take record corporation tax revenues as a given in recent years, 'particularly in the context of a deeply uncertain international trading environment'. Pic: Leah Farrell / © The latest Exchequer numbers came as Mr Trump announced details of a new Apple pledge to invest $100billion (€85billion) in US manufacturing, which will raise concerns about the firm's Irish operations and the level of investment it is planning here. The news came less than 48 hours after Mr Trump threatened on Monday to introduce tariffs of up to 250% on pharmaceutical imports and on semiconductors 'within the next week or so'. This was despite the European Union saying last week that it was under the impression that pharma would be included in the agreement it reached with the White House, which will see additional tariffs of 15% imposed on exports to the US. 'We'll be putting an initially small tariff on pharmaceuticals, but in one year, one-and-a-half years maximum, it's going to go to 150% and then it's going to go to 250% because we want pharmaceuticals made in our country,' Mr Trump said on Monday. 'They [pharmaceutical companies] make a fortune with pharmaceuticals, and they make in China and Ireland and everything else. This is a, you know, this is a separate class than the 15% tariffs on sort of everything.' Speaking to a top Government source dismissed concerns that July's tax revenues will invoke a strong reaction from Washington. 'The feeling is that the deal agreed between the US and EU gives as much protection as could be hoped for. I don't think the latest Exchequer returns change that,' they said.
Irish Times
31 minutes ago
- Irish Times
Trump's higher tariff rates kick in, hitting goods from major trading partners
President Donald Trump's higher tariff rates of 10 per cent to 50 per cent on dozens of trading partners kicked in on Thursday, testing his strategy for shrinking US trade deficits without large disruptions to global supply chains, higher inflation and stiff retaliation from trading partners. US Customs and Border Protection agency began collecting the higher tariffs at 12.01am EDT (0401 GMT) after weeks of suspense over Mr Trump's final tariff rates and frantic negotiations with major trading partners that sought to lower them. Goods loaded on to US-bound vessels and in transit before the midnight deadline can enter at lower prior tariff rates before October 5th, according to a CBP notice to shippers issued this week. Imports from many countries had previously been subject to a baseline 10 per cent import duty after Mr Trump paused higher rates announced in early April. But since then, Trump has frequently modified his tariff plan, slapping some countries with much higher rates, including 50 per cent for goods from Brazil, 39 per cent from Switzerland, 35 per cent from Canada and 25 per cent from India. He announced a separate 25 per cent tariff on Indian goods on Wednesday to be imposed in 21 days over the South Asian country's purchases of Russian oil. Ahead of the deadline, Mr Trump heralded the 'billions of dollars' that will flow into the US, largely from countries that he said had taken advantage of the United States. 'THE ONLY THING THAT CAN STOP AMERICA'S GREATNESS WOULD BE A RADICAL LEFT COURT THAT WANTS TO SEE OUR COUNTRY FAIL!' Mr Trump said on Truth Social. Eight major trading partners accounting for about 40 per cent of US trade flows have reached framework deals for trade and investment concessions with Mr Trump, including the European Union, Japan and South Korea, reducing their base tariff rates to 15 per cent. Britain won a 10 per cent rate, while Vietnam, Indonesia, Pakistan and the Philippines secured rate reductions to 19 per cent or 20 per cent. 'For those countries, it's less bad news,' said William Reinsch, a senior fellow and trade expert at the Center for Strategic and International Studies in Washington. 'There'll be some supply chain rearrangement. There'll be a new equilibrium. Prices here will go up, but it'll take a while for that to show up in a major way,' Mr Reinsch said. Countries with punishingly high duties, such as India and Canada, 'will continue to scramble around trying to fix this,' he added. Mr Trump's order has specified that any goods determined to have been trans-shipped from a third country to evade higher US tariffs will be subject to an additional 40 per cent import duty, but his administration has released few details on how these goods would be identified or the provision enforced. Mr Trump's July 31st tariff order imposed duties above 10 per cent on 67 trading partners, while the rate was kept at 10 per cent for those not listed. These import taxes are one part of a multilayered tariff strategy that includes national security-based sectoral tariffs on semiconductors, pharmaceuticals, autos, steel, aluminium, copper, lumber and other goods. Trump said on Wednesday the microchip duties could reach 100 per cent. China is on a separate tariff track and will face a potential tariff increase on August 12th unless Trump approves an extension of a prior truce after talks last week in Sweden. He has said he may impose additional tariffs over China's purchases of Russian oil as he seeks to pressure Moscow into ending its war in Ukraine. Financial markets largely shrugged off the new tariffs, with stock markets in Asia at or near record highs while the dollar dipped slightly. Mr Trump has touted the vast increase in federal revenues from his import tax collections, which are ultimately paid by companies importing the goods and consumers of end products. US Treasury Secretary Scott Bessent has said that US tariff revenues could top $300 billion a year. The move will drive average US tariff rates to around 20 per cent, the highest in a century and up from 2.5 per cent when Trump took office in January, the Atlantic Institute estimates. Commerce Department data released last week showed more evidence that tariffs began driving up US prices in June, including for home furnishings and durable household equipment, recreational goods and motor vehicles. Costs from Mr Trump's tariff war are mounting for a wide swath of companies, including bellwethers Caterpillar, Marriott, Molson Coors and Yum Brands. All told, global companies that have reported earnings so far this quarter are looking at a hit of around $15 billion to profits in 2025, Reuters' global tariff tracker shows. – Reuters
