Trump admin plans first ‘Golden Dome' test of space-based missile defense system: report
That timeframe lines up with Trump's ambitious goal to 'have it done in three years' and comes amid pitches from defense contractors to score coveted contracts to develop the cutting-edge system.
'They want a win to point to in November [2028],' a defense official told CNN. 'And DoD [Department of Defense] wants to avoid anything they perceive will slow them down.'
Advertisement
The test, which will be conducted by the Missile Defense Agency, is expected to be called FTI-X, which stands for 'Flight Test Integrated,' in a nod to how it will assess the Golden Dome's vast array of sensors and weapons systems, according to the report.
Development of the state-of-the-art missile defense system is expected to cost about $175 billion, according to Trump, who tapped Gen. Michael Guetlein, vice chair of operations at the Space Force, to oversee the ambitious project in May.
4 President Trump wants the US to develop a state-of-the-art missile defense system to protect the homeland from advanced attacks.
Getty Images
Advertisement
4 The Golden Dome system is intended to safeguard the colossal continental US.
AP
Congress has already allocated $25 billion in funding for the Golden Dome in the One Big Beautiful Bill Act, which Trump signed into law last month.
Military officials have explored space-based missile defense technologies for decades, including during Ronald Reagan's Star Wars program, also known as the Strategic Defense Initiative (SDI).
Space-based missile defense technology can be advantageous because it can help thwart an enemy missile much earlier in its trajectory than other technologies that the US currently has in its arsenal.
Advertisement
It can also reduce geographical barriers and catch certain types of enemy missiles at a stage when they are slower and easier to intercept.
However, there are many drawbacks. The US would need to make significant technological advances to develop that system, which is likely to be very costly and could entice other countries to weaponize space.
4 Skeptics have raised questions about whether the Golden Dome can be completed on time and within the budget President Trump laid out.
Getty Images
The defense official called it a 'hard problem, and technically very risky,' CNN reported.
Advertisement
'The possible number of satellites needed to achieve a probability of engagement success is going to be very high, given the time and area needed to cover the continental United States,' the defense official said.
Plans for the test in 2028 are expected to be 'phase one' of the project.
A deluge of defense contractors and other private companies have been jockeying for contracts to help develop the massive defense system.
Precise details of how the Golden Dome system will function are not fully known. Trump has taken inspiration from Israel's feted Iron Dome system, which helps defend populated areas from short-range attacks.
Trump's plans would encompass much more sophisticated missiles, such as ballistic and hypersonic missiles, that may potentially be fired off from much more distant locations than what Iron Dome defends against.
'Once fully constructed, the Golden Dome will be capable of intercepting missiles even if they are launched from other sides of the world,' Trump teased in May.
4 Precise details about how the Golden Dome system will function are not clear.
Getty Images
Guetlein has admitted that the Pentagon faces enormous challenges in successfully completing the project.
Advertisement
'I think the real technical challenge will be building of the space-based interceptor,' Guetlein said at a summit last month. 'That technology exists, I believe. I believe we have proven every element of the physics, that we can make it work.'
'What we have not proven is, first, can I do it economically, and then second, can I do it at scale? Can I build enough satellites to get after the threat? Can I expand the industrial base fast enough to build those satellites?'
The initiative comes amid advancements in the American space industry, with tycoons such as Elon Musk working to bring down the costs of launching satellites.
The Defense Department didn't reply to a request for comment Sunday.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
9 minutes ago
- Yahoo
The debanking issue is back as Trump slams — once again — some major lenders
Debanking is back in the spotlight this week after President Trump said Tuesday that the country's two largest US banks, JPMorgan Chase (JPM) and Bank of America (BAC), denied him as a customer. "The banks discriminated against me very badly, and I was very good to the banks," Trump said on CNBC's "Squawk Box," adding that "they discriminate against many conservatives." For years, Republicans have claimed that US banks have denied accounts to certain customers for political reasons. Crypto companies have warned more recently that they weren't permitted to get banking services during the Biden era. "I had hundreds of millions. I had many, many accounts loaded up with cash. I was loaded up with cash, and they told me, 'I'm sorry, sir, we can't have you. You have 20 days to get out,'" Trump said of his experience losing bank accounts with JPMorgan Chase. The president said he then went to Bank of America "to deposit a billion dollars plus" and was similarly denied. "He said, 'We can't do it,'" Trump told "Squawk Box" while also referencing pressure on banks from Washington, D.C., regulators as a key reason for why he and others have been denied banking services. "I ended up going to small banks all over the place," Trump added. The president's comments came in response to a Wall Street Journal report late Monday stating that the White House is preparing to draft a related executive order around debanking that would fine banks found discriminating against customers on political grounds. Bank of America did not immediately offer a response to Trump's comments. "We don't close accounts for political reasons, and we agree with President Trump that regulatory change is desperately needed. We commend the White House for addressing this issue and look forward to working with them to get this right," a JPMorgan spokesperson said in emailed comments. Both of these giant lenders and their CEOs have denied debanking customers on political grounds. Learn more about high-yield savings accounts, money market accounts, and CD accounts. Trump first brought visibility to the debanking issue back in January when he confronted Bank of America's Brian Moynihan about it during a live Q&A at the World Economic Forum in Davos, Switzerland. "I hope you start opening your bank to conservatives," Trump told Moynihan. The president also appeared to include JPMorgan Chase CEO Jame Dimon in his confrontation. "I don't know if the regulators mandated that because of Biden or what, but you and Jamie and everybody else, I hope you open your banks to conservatives, because what you're doing is wrong," Trump added. Two months later, the Trump Organization sued major credit card lender Capital One (COF) for allegedly debanking hundreds of its accounts following the Jan. 6, 2021, attack on the US Capitol in Washington, D.C. Bank regulators have already eliminated one element in supervision that has been pointed to as a culprit of debunking, known as reputational risk. Critics said this element of supervision was previously too subjective, allowing regulators additional room to penalize lenders for taking on customers they deemed risky. "The heart of the problem is regulatory overreach and supervisory discretion," a spokesperson for the Bank Policy Institute, a D.C. banking industry advocacy group, said in an emailed statement. "The banking agencies have already taken steps to address issues like reputational risk, and we're hopeful that any forthcoming executive order will reinforce this progress by directing regulators to confront the flawed regulatory framework that gave rise to these concerns in the first place," BPI added. Each of the bosses for these big banks has addressed the issue by also pointing a finger at regulators. "We have not debanked anyone because of political or religious relationships, period," JPMorgan's Dimon said during a podcast interview earlier this year, in which he acknowledged that debanking happens. "The reality is that if they gave us clarity from the regulatory thing and avoid the second-guessing, that would be helpful," Bank of America's Moynihan said in a CBS interview on Sunday. David Hollerith is a senior reporter for Yahoo Finance covering banking, crypto, and other areas in finance. Click here for in-depth analysis of the latest stock market news and events moving stock prices Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
9 minutes ago
- Yahoo
Stock market today: Dow, S&P 500, Nasdaq slide as Wall Street eyes earnings, trade tensions
US stocks slipped on Tuesday as investors digested the latest wave of corporate earnings and various tariff updates. The benchmark S&P 500 (^GSPC) slid 0.4%, while the blue-chip Dow Jones Industrial Average (^DJI) also fell about 0.3%. The Nasdaq Composite (^IXIC) was down around 0.5%. Palantir (PLTR) stock jumped about 8% in early trading after the company's earnings report beat expectations and revealed its revenue had topped $1 billion in a quarter for the first time. On Monday, stocks sharply rebounded after tanking on Friday in the aftermath of a number of market-shaking events, including a weak jobs report, fresh tariffs, new signs of rising prices, and President Trump's firing of the commissioner of the Bureau of Labor Statistics. Meanwhile, Trump continued to amp up pressure on trade Monday, threatening to hike tariffs on India. Separately, in a Tuesday morning interview with CNBC, Trump said pharmaceutical imports could see tariffs of up to 250%. Trump also ruled out Treasury Secretary Scott Bessent as a potential incoming Fed chair, but noted that Jerome Powell's successor could be named "soon." Read more: The latest on Trump's tariffs Wall Street is now focused on the continuation of earnings season. On Tuesday, AMD (AMD) and Rivian (RIVN) are set to report their results. McDonald's (MCD) and Disney (DIS) earnings land Wednesday. However, another trade blow looms later in the week, with Trump's latest iteration of global tariffs set to take effect. Hims & Hers stock slides 6% after second quarter revenue misses forecasts Yahoo Finance's Jake Conley reports: Hims & Hers Health (HIMS) stock fell as much as 6% early Tuesday after the company reported revenue late Monday that fell shy of Wall Street forecasts while maintaining its full-year forecast. The telehealth company posted revenue of $544.8 million in the second quarter, marking a 73% increase year over year but missing analyst estimates for $552 million, according to Bloomberg data. Hims & Hers maintained its full-year revenue guidance of $2.3 billion to $2.4 billion. Earnings per share topped forecasts, coming in at $0.17 against expectations for $0.15. Read more here. PMI data points to "encouragingly robust' economic activity to start the third quarter Activity in the services continued to expand during the month of July according to two data releases on Tuesday morning. The Institute for Supply Management's (ISM) services PMI registered a reading of 50.1 in July, down from June's reading of 50.1, and below the 51.5 economists surveyed by Bloomberg had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. The manufacturing sector has been in contraction for most of the past two years. "July's PMI level continues to reflect slow growth, and survey respondents indicated that seasonal and weather factors had negative impacts on business," Steve Miller, the chair of the Institute for Supply Management Services Business Survey committee said in the release. "The most common topic among survey panelists remained tariff-related impacts, with a noticeable increase in commodities listed as up in price." Elsewhere on Tuesday, S&P Global's composite PMI, which combines both activity in the services and manufacturing sectors, July registered a reading of 55.1 in July, up from 52.9 the month prior. S&P Global chief business economist Chris Williamson said the data signals "encouragingly robust economic growth at the start of the third quarter." Williamson added that the July PMI data points to the US economy growing at a 2.5% annualized pace in the third quarter, above the 1.25% pace seen in the first half. Trump rules out Bessent as next Fed chair, says may name Powell replacement soon Yahoo Finance's Jennifer Schonberger and Myles Udland report: President Trump said Tuesday morning that the pool of potential nominees to succeed Federal Reserve Chair Jerome Powell is down to four people, and that Treasury Secretary Scott Bessent will not be nominated for the role. "The two Kevins are doing well, and I have two other people that are doing well," Trump said in an interview with CNBC on Tuesday. The "two Kevins" are in reference to former Fed governor Kevin Warsh and Kevin Hassett, director of the National Economic Council. Asked about Fed Governor Chris Waller and Secretary Bessent, Trump didn't deny that Waller was among the four possible replacements for Powell, but did say that Bessent does not want the job. "I love Scott, but he wants to stay where he is," Trump said. Read more here. Trending tickers in premarket trading: Pfizer, Palantir, Caterpillar Companies reporting earnings topped Yahoo Finance's trending tickers list on Tuesday. Here's a look at how they're trading 30 minutes before the opening bell: Read more live coverage of corporate earnings here. Palantir stock surges on Q2 beat and raise Palantir (PLTR) stock climbed 7% higher in premarket trading on Tuesday following the AI software company's blowout second quarter earnings report on Monday afternoon. Palantir's revenue topped $1 billion in a quarter for the first time as the company dodged government contract spending cuts and reported beat-and-raise results. Year to date, Palantir stock is up 112%. Yahoo Finance's Jake Conley reports: Read more here. Wall Street 2025 bonuses: Winners and losers so far Yahoo Finance's David Hollerith reports: Read more here. Good morning. Here's what's happening today. Economic data: S&P Global US Services PMI (July final) S&P Global US Composite, (July final); ISM services index (July) Earnings: AMD (AMD), BP (BP), Caterpillar (CAT), Duke Energy (DUK), Lucid Group (LCID), Opendoor (OPEN), Pfizer (PFE), Rivian (RIVN), Super Micro Computer (SMCI), Snap (SNAP), Upstart (UPST) Here are some of the biggest stories you may have missed overnight and early this morning: One key reason a slowing economy isn't shaking stock market bulls Wall Street 2025 bonuses: Winners and losers so far Big Tech is power-hungry, and America's aging grid can't keep up Pfizer beats in Q2 earnings, reaffirms 2025 outlook Trump's Fed pick could face resistance from colleagues on rates Intel struggles with key manufacturing process for next chip EU says it expects turbulence in trade relations with US Jefferies sees crowded trade in Big Tech as Fed nears rate cuts US rig decline outpaces efficiency, threatening oil output Autopilot verdict deals Tesla a 'black eye' Pfizer stock rises after beating Q2 earnings, reaffirming 2025 outlook Pfizer (PFE) stock rose 2% in premarket trading Tuesday after beating quarterly estimates on the top and bottom lines. The company posted earnings per share of $0.78, versus estimates of $0.58 per share, on revenue of $14.7 billion, compared to Wall Street expectations of $13.5 billion. Yahoo Finance's Anjalee Khemlani reports: Read more here. One key reason a slowing economy isn't shaking stock market bulls Yahoo finance's senior reporter Josh Schafer looks at why softening economic data may not be as important for stocks as AI: Read more here. Nvidia partner Hon Hai's July sales growth weakened by tariffs Nvidia's (NVDA) main server assembly partner Hon Hai Precision ( saw its Taiwan stock close 2% higher on Tuesday despite reporting a sales slowdown for July. Bloomberg News reports: Read more here. Oil flattened from multi-day drop after Trump's India rebuke Oil prices steadied from a three-day decline following a ramping up of threats from Trump to India over the Asian nation's continued use of Russian crude. Bloomberg reports: Read more here. Hims & Hers stock slides 6% after second quarter revenue misses forecasts Yahoo Finance's Jake Conley reports: Hims & Hers Health (HIMS) stock fell as much as 6% early Tuesday after the company reported revenue late Monday that fell shy of Wall Street forecasts while maintaining its full-year forecast. The telehealth company posted revenue of $544.8 million in the second quarter, marking a 73% increase year over year but missing analyst estimates for $552 million, according to Bloomberg data. Hims & Hers maintained its full-year revenue guidance of $2.3 billion to $2.4 billion. Earnings per share topped forecasts, coming in at $0.17 against expectations for $0.15. Read more here. Yahoo Finance's Jake Conley reports: Hims & Hers Health (HIMS) stock fell as much as 6% early Tuesday after the company reported revenue late Monday that fell shy of Wall Street forecasts while maintaining its full-year forecast. The telehealth company posted revenue of $544.8 million in the second quarter, marking a 73% increase year over year but missing analyst estimates for $552 million, according to Bloomberg data. Hims & Hers maintained its full-year revenue guidance of $2.3 billion to $2.4 billion. Earnings per share topped forecasts, coming in at $0.17 against expectations for $0.15. Read more here. PMI data points to "encouragingly robust' economic activity to start the third quarter Activity in the services continued to expand during the month of July according to two data releases on Tuesday morning. The Institute for Supply Management's (ISM) services PMI registered a reading of 50.1 in July, down from June's reading of 50.1, and below the 51.5 economists surveyed by Bloomberg had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. The manufacturing sector has been in contraction for most of the past two years. "July's PMI level continues to reflect slow growth, and survey respondents indicated that seasonal and weather factors had negative impacts on business," Steve Miller, the chair of the Institute for Supply Management Services Business Survey committee said in the release. "The most common topic among survey panelists remained tariff-related impacts, with a noticeable increase in commodities listed as up in price." Elsewhere on Tuesday, S&P Global's composite PMI, which combines both activity in the services and manufacturing sectors, July registered a reading of 55.1 in July, up from 52.9 the month prior. S&P Global chief business economist Chris Williamson said the data signals "encouragingly robust economic growth at the start of the third quarter." Williamson added that the July PMI data points to the US economy growing at a 2.5% annualized pace in the third quarter, above the 1.25% pace seen in the first half. Activity in the services continued to expand during the month of July according to two data releases on Tuesday morning. The Institute for Supply Management's (ISM) services PMI registered a reading of 50.1 in July, down from June's reading of 50.1, and below the 51.5 economists surveyed by Bloomberg had expected. Readings above 50 for this index indicate an expansion in activity, while readings below 50 indicate contraction. The manufacturing sector has been in contraction for most of the past two years. "July's PMI level continues to reflect slow growth, and survey respondents indicated that seasonal and weather factors had negative impacts on business," Steve Miller, the chair of the Institute for Supply Management Services Business Survey committee said in the release. "The most common topic among survey panelists remained tariff-related impacts, with a noticeable increase in commodities listed as up in price." Elsewhere on Tuesday, S&P Global's composite PMI, which combines both activity in the services and manufacturing sectors, July registered a reading of 55.1 in July, up from 52.9 the month prior. S&P Global chief business economist Chris Williamson said the data signals "encouragingly robust economic growth at the start of the third quarter." Williamson added that the July PMI data points to the US economy growing at a 2.5% annualized pace in the third quarter, above the 1.25% pace seen in the first half. Trump rules out Bessent as next Fed chair, says may name Powell replacement soon Yahoo Finance's Jennifer Schonberger and Myles Udland report: President Trump said Tuesday morning that the pool of potential nominees to succeed Federal Reserve Chair Jerome Powell is down to four people, and that Treasury Secretary Scott Bessent will not be nominated for the role. "The two Kevins are doing well, and I have two other people that are doing well," Trump said in an interview with CNBC on Tuesday. The "two Kevins" are in reference to former Fed governor Kevin Warsh and Kevin Hassett, director of the National Economic Council. Asked about Fed Governor Chris Waller and Secretary Bessent, Trump didn't deny that Waller was among the four possible replacements for Powell, but did say that Bessent does not want the job. "I love Scott, but he wants to stay where he is," Trump said. Read more here. Yahoo Finance's Jennifer Schonberger and Myles Udland report: President Trump said Tuesday morning that the pool of potential nominees to succeed Federal Reserve Chair Jerome Powell is down to four people, and that Treasury Secretary Scott Bessent will not be nominated for the role. "The two Kevins are doing well, and I have two other people that are doing well," Trump said in an interview with CNBC on Tuesday. The "two Kevins" are in reference to former Fed governor Kevin Warsh and Kevin Hassett, director of the National Economic Council. Asked about Fed Governor Chris Waller and Secretary Bessent, Trump didn't deny that Waller was among the four possible replacements for Powell, but did say that Bessent does not want the job. "I love Scott, but he wants to stay where he is," Trump said. Read more here. Trending tickers in premarket trading: Pfizer, Palantir, Caterpillar Companies reporting earnings topped Yahoo Finance's trending tickers list on Tuesday. Here's a look at how they're trading 30 minutes before the opening bell: Read more live coverage of corporate earnings here. Companies reporting earnings topped Yahoo Finance's trending tickers list on Tuesday. Here's a look at how they're trading 30 minutes before the opening bell: Read more live coverage of corporate earnings here. Palantir stock surges on Q2 beat and raise Palantir (PLTR) stock climbed 7% higher in premarket trading on Tuesday following the AI software company's blowout second quarter earnings report on Monday afternoon. Palantir's revenue topped $1 billion in a quarter for the first time as the company dodged government contract spending cuts and reported beat-and-raise results. Year to date, Palantir stock is up 112%. Yahoo Finance's Jake Conley reports: Read more here. Palantir (PLTR) stock climbed 7% higher in premarket trading on Tuesday following the AI software company's blowout second quarter earnings report on Monday afternoon. Palantir's revenue topped $1 billion in a quarter for the first time as the company dodged government contract spending cuts and reported beat-and-raise results. Year to date, Palantir stock is up 112%. Yahoo Finance's Jake Conley reports: Read more here. Wall Street 2025 bonuses: Winners and losers so far Yahoo Finance's David Hollerith reports: Read more here. Yahoo Finance's David Hollerith reports: Read more here. Good morning. Here's what's happening today. Economic data: S&P Global US Services PMI (July final) S&P Global US Composite, (July final); ISM services index (July) Earnings: AMD (AMD), BP (BP), Caterpillar (CAT), Duke Energy (DUK), Lucid Group (LCID), Opendoor (OPEN), Pfizer (PFE), Rivian (RIVN), Super Micro Computer (SMCI), Snap (SNAP), Upstart (UPST) Here are some of the biggest stories you may have missed overnight and early this morning: One key reason a slowing economy isn't shaking stock market bulls Wall Street 2025 bonuses: Winners and losers so far Big Tech is power-hungry, and America's aging grid can't keep up Pfizer beats in Q2 earnings, reaffirms 2025 outlook Trump's Fed pick could face resistance from colleagues on rates Intel struggles with key manufacturing process for next chip EU says it expects turbulence in trade relations with US Jefferies sees crowded trade in Big Tech as Fed nears rate cuts US rig decline outpaces efficiency, threatening oil output Autopilot verdict deals Tesla a 'black eye' Economic data: S&P Global US Services PMI (July final) S&P Global US Composite, (July final); ISM services index (July) Earnings: AMD (AMD), BP (BP), Caterpillar (CAT), Duke Energy (DUK), Lucid Group (LCID), Opendoor (OPEN), Pfizer (PFE), Rivian (RIVN), Super Micro Computer (SMCI), Snap (SNAP), Upstart (UPST) Here are some of the biggest stories you may have missed overnight and early this morning: One key reason a slowing economy isn't shaking stock market bulls Wall Street 2025 bonuses: Winners and losers so far Big Tech is power-hungry, and America's aging grid can't keep up Pfizer beats in Q2 earnings, reaffirms 2025 outlook Trump's Fed pick could face resistance from colleagues on rates Intel struggles with key manufacturing process for next chip EU says it expects turbulence in trade relations with US Jefferies sees crowded trade in Big Tech as Fed nears rate cuts US rig decline outpaces efficiency, threatening oil output Autopilot verdict deals Tesla a 'black eye' Pfizer stock rises after beating Q2 earnings, reaffirming 2025 outlook Pfizer (PFE) stock rose 2% in premarket trading Tuesday after beating quarterly estimates on the top and bottom lines. The company posted earnings per share of $0.78, versus estimates of $0.58 per share, on revenue of $14.7 billion, compared to Wall Street expectations of $13.5 billion. Yahoo Finance's Anjalee Khemlani reports: Read more here. Pfizer (PFE) stock rose 2% in premarket trading Tuesday after beating quarterly estimates on the top and bottom lines. The company posted earnings per share of $0.78, versus estimates of $0.58 per share, on revenue of $14.7 billion, compared to Wall Street expectations of $13.5 billion. Yahoo Finance's Anjalee Khemlani reports: Read more here. One key reason a slowing economy isn't shaking stock market bulls Yahoo finance's senior reporter Josh Schafer looks at why softening economic data may not be as important for stocks as AI: Read more here. Yahoo finance's senior reporter Josh Schafer looks at why softening economic data may not be as important for stocks as AI: Read more here. Nvidia partner Hon Hai's July sales growth weakened by tariffs Nvidia's (NVDA) main server assembly partner Hon Hai Precision ( saw its Taiwan stock close 2% higher on Tuesday despite reporting a sales slowdown for July. Bloomberg News reports: Read more here. Nvidia's (NVDA) main server assembly partner Hon Hai Precision ( saw its Taiwan stock close 2% higher on Tuesday despite reporting a sales slowdown for July. Bloomberg News reports: Read more here. Oil flattened from multi-day drop after Trump's India rebuke Oil prices steadied from a three-day decline following a ramping up of threats from Trump to India over the Asian nation's continued use of Russian crude. Bloomberg reports: Read more here. Oil prices steadied from a three-day decline following a ramping up of threats from Trump to India over the Asian nation's continued use of Russian crude. Bloomberg reports: Read more here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
9 minutes ago
- Yahoo
Analysis-Brazil's economy ready to ride out Trump's 50% tariff
By Marcela Ayres and Bernardo Caram BRASILIA (Reuters) -Brazilian goods imported by the United States will soon carry one of the highest tariffs imposed by President Donald Trump, but that will not likely derail Latin America's largest economy, due to ample exemptions and stronger trade ties with China. The lower stakes for the Brazilian economy give President Luiz Inacio Lula da Silva more room to stand his ground against Trump than most Western leaders, after calling him an unwanted global "emperor" and comparing his tariff threats to blackmail. Lula has said he is open to negotiating a trade deal, but dismissed Trump's complaints about the trial of right-wing ally Jair Bolsonaro as a threat to Brazilian sovereignty and judicial independence. Brazil's Supreme Court is trying the ex-president for allegedly plotting to overturn the 2022 election he lost to Lula. Those tensions, stoked by Bolsonaro's house arrest on Monday, are likely to make negotiations about the 50% U.S. tariff on Brazilian goods between Washington and Brasilia thorny and drawn out, even as the fallout for Brazil's economy looks limited. Unlike Mexico and Canada, which sell about three-quarters of their exports to the United States, Americans buy just 12% of Brazilian exports. By comparison, Brazil's exports to China have doubled in value over the past decade, now accounting for 28% of the country's total shipments. After exemptions laid out in Trump's executive order last week, including on aircraft, energy, and orange juice, the tariff taking effect on Wednesday will apply to just under 36% of Brazilian exports to the U.S. by value, according to estimates in Brasilia. Many of the affected exports are commodities such as beef and coffee, which should find alternative markets at modest discounts, according to economists. "We were already expecting a limited impact, but it dropped further with the exemptions," said Luiza Pinese, an economist at XP, who halved her forecast for the tariff impact on Brazil's gross domestic product this year to 0.15 percentage points. Goldman Sachs maintained its projection for Brazil's economy to grow 2.3% this year in light of the "notable" exemptions, adding that government support for affected sectors, expected in the coming days, should further soften the economic blow. "Brazil depends on the United States, that's true, but also on BRICS countries, on Europe, on Mercosur," Planning Minister Simone Tebet said at a public event last week, referring to major developing nations such as China, India, and Russia and a South American trade bloc. She said almost half of Brazil's agribusiness trade, an engine for Brazil's economy in recent years, is concentrated in Asia, compared to just 10% with the United States. "When it comes to industry, the ratio is four to one - four times more to Asia than to the United States," she added. SMALLER ROLE FOR TRADE Brazil is far less open to trade than most major global economies, limiting fallout from trade disruptions. Exports and imports amounted to 36% of its GDP last year, less than half the share in Mexico and nearby Paraguay, and just a quarter of the level in trade-focused Asian economies such as Thailand and Malaysia, according to World Bank data. Much of Brazil's exports are commodities easily redirected to different markets over time, said Thiago Carlos, a PIMCO portfolio manager for emerging markets. In the short term, more domestic food supply may even help to bring down inflation, he added. "With inflation likely to trend lower, the central bank may find room to begin easing monetary policy sooner than expected," said Carlos, noting the benchmark rate at the current level of 15% keeps monetary policy extremely tight, dragging on growth. Analysts polled by Reuters estimated that even without a U.S. trade deal and before exemptions, Brazil's growth outlook for 2026 would remain virtually unchanged from their consensus of 1.6%-1.7%. Still, Luis Otavio Leal, chief economist at asset manager G5 Partners, warned of potential knock-on effects if government aid is not well targeted to protect vulnerable sectors and jobs. "Exemptions applied to nearly 700 products - and Brazil exports about 4,000 different goods to the U.S.," said Leal. "A large number of firms that sell to the U.S. were not covered." Brazil's central bank said on Monday that U.S. levies on Brazilian goods could have "significant" effects on specific sectors, but broader macroeconomic effects are uncertain and will depend on negotiations and market risk perceptions. Flavio Ataliba, a researcher at Brazilian university FGV, noted that the vast country's regional variety will result in uneven impacts. The Northeast region, in particular, could be hit harder due to its export base of low-value-added, labor-intensive goods such as fresh fruit, seafood, textiles, and footwear - all now subject to the full 50% tariff, he added. 擷取數據時發生錯誤 登入存取你的投資組合 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤
