Financial encyclopedia

Recently, a US court ruled that some of the tariffs imposed during the Trump administration were "illegal", as a result of a lawsuit filed by small businesses and several states, claiming that he had abused his presidential emergency powers. Trump has indicated that he will appeal to the Supreme Court. 

The problem is that if the US ultimately loses the case, it may have to refund trillions of dollars in tariffs, which would have a significant impact on the market. 

What does it mean if a tax refund is really going to be issued? 

Fiscal pressure in the United States 

Returning trillions of dollars in tax refunds is equivalent to a huge fiscal expenditure, and the deficit will further expand. 

The trend of the US dollar 

The deterioration of government debt may undermine market confidence in the US dollar. 

Gold strengthens. 

Increased uncertainty and the rising demand for safe-haven assets naturally benefit gold. 

The stock market performance is contradictory. 

While the cost pressure on some individual enterprises has eased, the overall market may be under pressure due to the uncertainty of policies. 

The Game of Law and Politics 

The court pointed out that some tariffs lack legitimate grounds and violate international trade norms, demonstrating that administrative power cannot completely override judicial authority. 

The International Emergency Economic Powers Act (IEEPA) invoked by Trump was originally intended for emergency situations such as terrorist attacks or sanctions, rather than for the long-term imposition of large-scale tariffs. 

In other words, the court held that Trump had "overstepped his authority" in using emergency powers and had used the legal framework as a political lever. 

Global Impact: Not Just the United States 

China and Asia: The additional tariffs are most directly targeted at Chinese exports. If tax rebates are provided, the supply chain may experience "relief". 

Europe: European carmakers and luxury goods makers, which were once affected, are now expected to benefit. 

International trust: Firms are concerned about the capriciousness of US policies and are more inclined to diversify their investments, reducing their reliance on a single market. 

What should we pay attention to in the future market? 

In the short term: Gold may continue to benefit, while the US dollar remains under pressure. 

Mid-term: Whether the Supreme Court will accept the case and the outcome of the judgment. 

Even with tax rebates, the global trade landscape has been reshaped, and it is difficult for enterprises to immediately return to the "tariff-free era".