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NDTV
2 hours ago
- NDTV
Trump Says US Will Reap Billions From Tariff Blitz. But Who Pays The Bill?
US President Donald Trump says the United States will reap billions of dollars from his tariff blitz, but who pays the bill? Higher tariffs on goods from dozens of trading partners kicked in Thursday, ranging between 15 per cent and 41 per cent. Here is a look at the effects of Trump's tariff onslaught: Higher prices for US consumers? The tariffs are paid by US-based companies to US customs when they import goods from abroad. US consumers could see a range of products become more expensive if companies choose to raise prices to offset the higher costs of importing goods. For instance, Japanese cars face a 15-per-cent tariff while made-in-Vietnam T-shirts now have a 20-per-cent duty. But companies have other options: they can absorb the higher cost, which would hit their bottom line, or they can try to negotiate lower prices with exporters. US Federal Reserve Chairman Jerome Powell estimated at the end of July that higher tariffs were beginning to be felt on certain goods. For example, the US toy company Hasbro, maker of the Monopoly board game and the owlish electronic toy Furby and which imports half of its products from China, began raising prices in May and June. Procter & Gamble, the maker of Tide laundry detergent and Pampers diapers, has projected a $1 billion hit from US tariffs over the next year and said it would institute limited price hikes in the United States. The tariffs are even more problematic for US economic sectors which don't have an option to switch to local suppliers, said Philippe Chalmin, emeritus professor at Paris-Dauphine University. The United States imports lots of copper, a key metal in electrical machinery and wiring, which Trump announced would face a 50 per cent tariff on August 1. "Half of what the United States needs is imported from Chile, and following the announcement, the price of copper on the US market rose 25 per cent compared with the global reference price," said Chalmin. In the end, however, the Trump administration backpedalled and applied the tariff only to semi-finished copper products such as pipes and wires. Loss of competitiveness The bill could also weigh on companies which depend heavily on exports, with the rising prices of their products in the United States leading to a loss of competitiveness. This is the concern for the European wine and spirits sector, which has yet to obtain an exception from US tariffs. Higher prices on Champagne or Chianti could easily push US consumers to grab a bottle of Californian wine. The impact "will be all the harsher" since, in addition to the tariffs, the value of the dollar has fallen, which further increases the price of the bottles on shelves in US shops, warned Gabriel Picard, president of the French Federation of Wine and Spirits Exporters. He estimated that this combined effect could result in a one-billion-euro loss for French producers. "There will be sectoral differences and even within the same sector, it will depend on the negotiating power" between the producer, the wholesaler, and the retailer, said Bruno de Moura Fernandes, head of macroeconomic research at Coface, a firm which provides insurance and financial services for exporters. However, he said that the effect will be especially significant for industries already facing difficulties remaining competitive against their American counterparts, notably in the chemicals and steel sectors. Thinning margins Some companies have already announced that they will cut into their profit margins to offset the effects of US tariffs. Automakers, among the first affected by US tariffs, have already seen sales and profits hit. German auto giant Volkswagen said last month that US tariffs had cost it 1.3 billion euros ($1.5 billion) in the first half of the year as it reported falling profit. It now forecasts a profit margin for the year of between four and five per cent, down from 5.5 to 6.5 per cent previously, amounting to billions of euros for the group. US tariffs prompted Japanese auto giant Toyota -- the world's largest carmaker by sales-- to cut its annual net profit forecast by 14 per cent.
Time of India
2 hours ago
- Time of India
Shots fired at Kapil Sharma's restaurant in Canada again
NEW DELHI: Comedian Kapil Sharma's cafe in Canada came under attack yet again as unidentified gunmen fired shots at the restaurant in Surrey early Thursday, reports Rajshekhar Jha. This was the second shooting at Kap's Cafe within a month. Around 9-10 shots were fired at the restaurant, of which at least six hit its walls and windows. Nobody was injured. Residents of the area called police around 4.30am on hearing gunshots, prompting dispatch of several units. A social media post - whose authenticity is not verified - surfaced after the shooting in which Goldy Dhillon, an aide of Lawrence Bishnoi and Goldy Brar, claimed responsibility for the attack. Indian agencies are verifying the authenticity of the post which says the gangsters had called Sharma, but as he didn't answer they had to act. The post threatens that the gang's next operation will be in Mumbai. Earlier on July 9, shots were fired at Kap's Cafe by a shooter who was wearing a body-camera and filming the shooting. Germany-based Babbar Khalsa International (BKI) terrorist Harjeet Singh Laddi had claimed responsibility for the attack.
Time of India
3 hours ago
- Time of India
IT sector may be hit amid AI shift, slower spending
Bengaluru: As AI-driven efficiency gains increasingly impact deal wins, triggering steeper rate cuts, the 25% additional tariffs imposed by US President Donald Trump pose a double whammy to India's IT sector. Even as the sector anticipated greater trade clarity by Aug-a development expected to boost US consumer spending-the announcement of an additional 25% tariff now threatens to dampen sentiment and stall the fragile recovery in discretionary spending. Phil Fersht, CEO of US-based HfS Research, said Trump's 25% tariff is the new IT services wrecking ball. "While services aren't directly taxed, the new tariffs stoke inflation in the US, forcing American firms to tighten discretionary spending. As manufacturing, logistics, and retail customers reel from higher input costs, they'll look to slash consulting and IT outsourcing contracts first, slowing deal cycles and delaying rollouts. Deal slippage will be most visible in manufacturing, logistics, and retail verticals by the Sept quarter." Fersht believes the new levy is forcing American enterprises to slam the brakes on discretionary spending. "A tariff-fuelled downturn in the world's largest economy typically translates into weaker tech budgets, directly crimping Indian software export growth, which depends on US buyers for over half its $190 billion in annual revenues." by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 20 Unforgettable Cars from the Past Undo In a recent report, Kotak Institutional Equities said the demand environment took a slight hit due to uncertainty over the Trump administration's tariff regime, with considerable impact on retail, logistics, and manufacturing verticals. "The hi-tech vertical is focused on investing for the future (AI-related capex and opex) while optimising the present (cuts to discretionary spending and prioritising spends away from other bets to AI). The healthcare vertical is operating under considerable uncertainty with payers under cost pressure and Trump ratcheting pressure on big pharma with threats of tariffs and changes to the drug pricing regime," the note said. Stay informed with the latest business news, updates on bank holidays and public holidays .
