The Trump administration in the U.S. announced an expansion of the 50% tariffs on steel and aluminum imports, with the expanded tariff list officially taking effect on August 18.
On August 15 local time, the Trump administration announced the expansion of the 50% tariffs on steel and aluminum imports, adding hundreds of derivative products to the tariff list.
In a notice published in the Federal Register that evening, the U.S. Department of Commerce stated that the Bureau of Industry and Security had added 407 product codes to the U.S. Harmonized Tariff Schedule. These products will face additional tariffs due to their steel and aluminum content.
The notice clarified that the non-steel and non-aluminum portions of these products would be subject to the tariff rates imposed by President Trump on specific countries. The expanded tariff list will officially take effect on August 18.
On June 3 local time, the White House issued a statement announcing that President Trump would increase tariffs on steel and aluminum imports and their derivatives from 25% to 50%. The policy took effect at 00:01 AM Eastern Time on June 4, 2025.
Previously, in July, Alcoa, the largest aluminum producer in the U.S., stated that the U.S. tariff policy was continuously increasing its production costs. Due to the tariffs, its American customers were paying more for aluminum.
Alcoa reported that, affected by the U.S. government's tariff policies, its production costs increased by $20 million in the first quarter of this year. In the second quarter, the U.S. tariffs on Canada led to an additional $115 million in production costs for Alcoa. (Note: On March 4, the U.S. imposed a 25% tariff on products from Canada and Mexico. On March 12, the U.S. began imposing a 25% tariff on all imported steel and aluminum.)
According to Alcoa, about 70% of the aluminum it produces in Canada is sold to the U.S., and its American customers are now paying "higher prices than other regions globally." U.S. media pointed out that the current steel and aluminum tariffs are the highest since the 1930s, which will inevitably drive up the prices of steel and aluminum, increase production costs for manufacturers using these materials, and ultimately lead to higher prices for consumers. Additionally, some workers in steel- and aluminum-dependent manufacturing sectors may lose their jobs due to rising costs.
Furthermore, on August 15 local time, President Trump stated that semiconductor tariffs would be announced within two weeks, with rates potentially reaching 300%.
The latest data shows that U.S. companies are facing rising cost pressures, which may be further passed downstream.
The latest data from the U.S. Labor Department revealed that the July Producer Price Index (PPI) rose by 0.9% month-on-month, significantly higher than June's zero growth and market expectations of 0.2%, marking the largest increase since June 2022. Year-on-year, the PPI increased by 3.3%, far exceeding June's 2.3% and market expectations of 2.6%, reaching the highest level since February this year.
The Labor Department's data also showed that the July PPI increase was primarily driven by the services sector. The services PPI rose by 1.1% month-on-month, the largest increase since March 2022.
Excluding volatile food and energy prices, the core PPI rose by 0.9% month-on-month in July, with a year-on-year increase of 3.7%, significantly higher than the previous month's 2.6% growth.
Chicago Fed President Austan Goolsbee previously stated that last week's mixed inflation data, coupled with lingering tariff uncertainties, made him hesitant about whether to cut interest rates. He noted that the CPI (Consumer Price Index) and PPI reports released last week left him "slightly uneasy" about the inflation outlook, as service prices "do not appear temporary" and are "on the rise."
