Hours before a midnight deadline, the White House announced its new trade policy, affecting virtually every nation as the US cemented its pivot away from decades of free trade and toward a new protectionist era.

“Universal” tariff rate: The administration said the “universal” tariff will remain at 10% — the same level implemented on April 2 — for countries the US has a trade surplus with, which is most of them. Nations with which the US has a trade deficit face a 15% floor.

New rate for Canada

In addition to the overall plan, President Donald Trump said he is raising tariffs on Canada from 25% to 35%, effective tomorrow. Goods compliant with the United States-Mexico-Canada Agreement would not be subject to that higher rate, the White House said, which would blunt the impact.

Court reviews tariff authority: Meanwhile in a notable hearing, a skeptical federal appeals court heard oral arguments about whether the US president overstepped his legal authority to impose many of his sweeping tariffs.

Clarity on trade between the world’s two largest economies is still elusive

As nations around the world grapple with higher tariffs, the fate of China’s economic future with the US remains uncertain, leaving one of the world’s most important trade relationships in limbo.

Despite a two-day meeting with Chinese and American negotiators this week in Stockholm, the two economic giants have yet to agree on a deal to prevent tariffs from soaring to significantly elevated levels.

While diplomats from both nations have portrayed the discussions in a positive light, US Treasury Secretary Scott Bessent stressed that any decision to extend a pause on tariffs will come from President Donald Trump.

Why their trade conversations are tricky?

Unlike Canada, the European Union, Japan and South Korea — all longtime American allies — the Sino-US relationship is combative.

The issues clogging the conversations extend far beyond financial arrangements. Both nations hold resources and technology viewed as crucial to their respective security and stability.

This includes China’s vast reservoirs of rare earth minerals, substances American firms need to build everything from electronic device, lighting and electric vehicles.

China’s manufacturing strength is also leaving a palpable impact on American consumers through higher costs and reduced merchandise, thanks to US tariffs already in place.

American companies, including tech giant Nvidia, hold chip technology that’s crucial in powering AI-related platforms.

Beyond economics, there’s also ego: Chinese leader Xi Jinping is balancing a fragile domestic economy, yet can’t risk any appearance of caving in to Trump and American demands. And Trump is notoriously mercurial – just look at how he threatened Canada yesterday as soon as Ottawa announced plans to recognize a Palestinian state.

Still, both leaders seem keen on a face-to-face meeting. How they tackle their deep divides on trade will reshape the global economic system.

Asia markets mostly decline on fresh US tariff shock: Stock markets across the Asia Pacific region were mostly in the red on Friday morning local time after US President Donald Trump unveiled historic new tariffs across the globe.

Japan’s benchmark Nikkei 225 slid 0.6% in the early hours of trading, and South Korea’s KOSPI plunged 3.2%. Taiwan’s TAIEX was down 0.4%, while Australia’s S&P/ASX 200 declined 0.7%. Hong Kong’s Hang Seng Index was up marginally at 0.2%.

President Donald Trump just set new tariffs for every country around the world, solidifying his extreme break with America’s long-standing trade policy.

The new tariff regime will not go into effect Friday, as expected. Instead, the tariffs will be implemented on August 7 to give Customs and Border Protection sufficient time to make the necessary changes to collect the new duties.

The White House announced Thursday that the “universal” tariff for goods coming into the United States will remain at 10%, the same level that was implemented on April 2. But that 10% rate will apply only to countries with which the US has a trade surplus – countries to which the US exports more than it imports. That applies to most countries, a senior administration official said.

A 15% rate will serve as the new tariff floor for countries with which the US has a trade deficit. About 40 countries will pay that new 15% tariff. That tariff will be lower for many of those nations than the April 2 “reciprocal” tariffs, but it will be higher for a handful.

More than a dozen countries have tariff rates that are higher than 15%, either because they agreed to a trade framework with the US or because Trump sent their leaders a letter dictating a higher tariff. The senior administration official said those countries have among the highest trade deficits with the United States.

Transshipment penalties: In addition, the new trade policy also establishes a 40% additional penalty on so-called transshipments. Those are goods that are shipped from a high-tariff country to a low-tariff country and then re-shipped to the US.

The US already imposes penalties and fines for goods that Customs and Border Protection agents deem to be transshipped. The 40% will come on top of that, a senior administration official said.

Increase on Canada: Trump signed an executive order increasing the tariff rate on Canadian goods that aren’t exempt from the USMCA free-trade agreement from 25% to 35%, the White House said in a statement Thursday. The higher tariff rate will go into effect tomorrow.

A senior Trump administration official described conversations with Canada surrounding fentanyl and tariffs on products in their country as less constructive than with Mexico, which received a 90-day pause on higher tariffs.

Ontario Premier Doug Ford said the higher tariff rate is “concerning,” especially with other tariffs still in place. And the president and CEO of Canada’s Chamber of Commerce called the statement released by the White House tonight “more fact-less tariff turbulence.”.

Oregon attorney general says legal battle over Trump's use of tariffs is an important moment for America. Attorney General Dan Rayfield told that President Donald Trump is abusing emergency powers to impose tariffs without oversight, calling the legal battle a very important moment for America.

Rayfield appeared in a federal appeals court today as lead plaintiff in a high-stakes lawsuit challenging Trump’s use of the International Emergency Economic Powers Act (IEEPA) — a 1977 law intended for national crises.

“It’s an interesting moment when the federal government looks those judges square in the eye and says ‘you don’t have a role here. You cannot cabin the authority of the president under this area and says we can set tariffs at absolutely any level, and you can’t do anything about it.”

Rayfield also cited the economic pressure the tariffs place on American consumers. “About 70% (of tariffs), give or take, are paid by the American people, so they can talk about deals all the time, but I’ve never talked about taxes and I’m a politician. … I don’t talk about taxes on American people as deals for all of us, we’re the ones paying these things,” Rayfield said.

When asked what precedent it sets for a President to bypass Congress to rewrite trade policy, Rayfield warned it would be “incredibly damaging” to the economy and the American people. “If the courts let that stand, which would be incredibly damaging to — and is being damaging to — our economy and to our people, what’s going to end up happening is Congress going to have to consider, ‘have we gone too far?’”

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