Ukraine’s central bank to hold interest rate at 15.5% amid rising inflation concerns
19 hours ago
The United States’ effective tariff rate (ETR) has settled at 17% following the latest reciprocal duty announcements on July 27 and July 31, according to Fitch Ratings.
This is about eight percentage points lower than the April 3 estimate, when higher reciprocal tariffs were first announced, but roughly three points higher than at the end of June.
“The US ETR of 17% reflects a 15% tariff rate on European Union goods, including auto and auto parts, and higher tariffs for major trading partners Brazil, Taiwan, India and Switzerland,” Fitch said. Lower reciprocal tariffs on EU products, down from the 30% threatened earlier in July, mean individual ETRs for EU countries now range from about 3% to over 18%. Fitch noted that the ETR measures total duties as a share of total imports and shifts with changes in import sources and product mix.
The new measures set a reciprocal tariff rate for Canada at 35% on non‑United States‑Mexico‑Canada Agreement (USMCA) compliant goods, leading to an ETR of 10% once 50% tariffs on aluminium, steel and copper are factored in.
“Tariffs on Mexico non‑USMCA compliant goods remain at 25% while the US trade negotiations continue. The ETR reflects our assumption that about half of previous tariff‑free imports will ultimately be reclassified as USMCA compliant,” Fitch said.
And on August 4, Trump just hit Switzerland with a 39% tariff – on the highest tariff rates in the world. The Swiss government immediately called an emergency meeting. The new tariff rate is due to go into effect on August 7 giving the government a few days to strike a deal with the White House.
Switzerland is being punished as it ran a $38.5bn trade surplus with the US last year – more than Mexico. The US remains its top export market for many of its luxury goods.
Under the August 1 tariff regime, the US has imposed a 15% reciprocal rate on goods from countries with which it runs a trade deficit and maintains a 10% baseline tariff for most other countries. Tariffs on China remain at 34%, giving it the highest ETR among major US trading partners.
Fitch added that “changes to the ETR are possible over the coming days if new trade deals are announced.”
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