Donald Trump used his 24 February State of the Union to claim an American “turnaround”, but the clear market signal was his decision to press ahead with broad import tariffs after the Supreme Court clipped his authority four days earlier. For investors, the near‑term question is not the applause lines in Washington but how a fresh round of duties will ripple through prices, margins and supply chains on both sides of the Atlantic. (fednet.net)

On 20 February the Supreme Court ruled 6–3 that the administration overreached by using the International Emergency Economic Powers Act to impose sweeping “Liberation Day” tariffs, a decision that also opens the door for firms to seek refunds of duties already paid. Markets quickly turned to what would replace them - and how quickly. (forbes.com)

The White House has since activated a new 10% global tariff under Section 122 of the 1974 Trade Act, a measure that can run for 150 days without Congress. Officials have also floated a move to 15%. From a business perspective that is a hard deadline for pricing and purchasing decisions in the US and for exporters into it. (theguardian.com)

Lawyers expect challenges because Section 122 is intended for fundamental balance‑of‑payments problems - a high bar in today’s conditions. Even if the tariff stands through late July, companies face another bout of policy whiplash that tends to freeze investment and keep prices sticky. (washingtonpost.com)

For the UK, the exposure is real. Goods exports to the US totalled £59.3bn in 2024 - 16.2% of all UK goods exports - led by machinery and transport equipment, cars and aerospace. Tariffs do not hit services directly, but goods‑heavy manufacturers and their suppliers will feel the squeeze first. (ons.gov.uk)

Sectorally, some product‑specific duties still bite. UK carmakers rely on the US as their number one export market, and separate levies on autos and car parts introduced last year sit on top of any new baseline duties. Steel and aluminium tariffs under Section 232 also remain. Stacking effects matter for final prices. (ons.gov.uk)

Business groups are already flagging the planning challenge. The British Chambers of Commerce warns that new US tariffs create cost and uncertainty for UK exporters and urges ministers to secure pragmatic carve‑outs where possible. Until clarity arrives, many firms will protect margins with surcharges or deferrals rather than commit to long‑run price cuts. (britishchambers.org.uk)

On inflation, most peer‑reviewed evidence shows US consumers and domestic firms bear the bulk of tariff costs. Goldman Sachs estimates that a 10 percentage‑point rise in the effective tariff rate lifts core PCE by roughly 0.9 percentage points, while PIIE modelling points to about a 1 percentage‑point inflation bump and slower growth through 2026. (cnbc.com)

For the UK, the pass‑through is more nuanced. The Bank of England has highlighted a two‑way effect: trade diversion can lower UK import prices as exporters re‑route goods away from the US, but rising global barriers can also trigger supply shocks and pockets of price pressure. Net‑net, the near‑term UK impact may be slightly disinflationary, but sector‑specific pain is likely. (bankofengland.co.uk)

What should UK finance teams do now? Assume the 10% US levy holds through late July, stress‑test for a 15% scenario, and revisit Incoterms and currency hedges with US buyers who may push for shared costs. With legal and political risk elevated, keep bids short‑dated and build review clauses into new contracts. If Section 122 is curtailed sooner, flexibility will matter as much as price. (transcripts.cnn.com)