The decision has significant implications for global trade flows and financial markets grappling with tariff-related uncertainty. Following the ruling, Wall Street’s major indexes rallied on Friday, with investors interpreting the decision as a potential reset for global trade tensions.
Trump has made tariffs a central pillar of his economic and foreign policy agenda. Shortly after the start of his second term, he imposed levies under the Emergency Powers Act, originally designed for national emergencies.
In April, under what he called “Liberation Day” tariffs, a baseline duty of 10% was imposed on all imports into the United States, with additional country-specific tariffs ranging from 15% to 50%. While many of these were later renegotiated and reduced, the broad tariff structure remained unchanged.
The tariffs were estimated to generate trillions of dollars in revenue over the next decade. However, they also fueled a global trade war, strained relations with major trading partners and contributed to increased volatility in global financial markets.
The Supreme Court’s ruling effectively dismantles the legal foundation for executors. This development could be a potential turning point in global trade dynamics, particularly for export-oriented economies and multinational corporations that have adjusted supply chains around the tariff regime.
For India, the verdict comes at a critical time when broader markets are facing volatility due to Fed uncertainty and a slowdown in IT stocks. Earlier this month, India and the United States reached an interim trade understanding aimed at easing tariff tensions.
Under that arrangement, the US It agreed to reduce reciprocal tariffs on Indian goods to 18%, while India committed to reducing certain tariff and non-tariff barriers on American imports. That agreement had already provided some relief to Indian markets, which have faced continued pressure amid global trade uncertainties.
Now, as a comprehensive tariff structure has been struck, the landscape may change again. It remains unclear how the US administration will respond and whether new trade measures could be introduced under various legal provisions.
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