WASHINGTON (REUTERS) - US President Donald Trump said on Monday (Dec 2) that he will immediately restore tariffs on US steel and aluminum imports from Brazil and Argentina.
“Brazil and Argentina have been presiding over a massive devaluation of their currencies, which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the US from those countries,” Trump said in a tweet.
Brazil’s President Jair Bolsonaro, an avowed Trump fan who has actively sought closer US ties, said in local radio interview that he did not think Trump’s decision was a form of retaliation.
However, he also expressed hope that Trump would show mercy to Brazil’s commodity-based economy.
“I’m going to call him so that he doesn’t penalise us,” Bolsonaro said.
“Our economy basically comes from commodities, it’s what we’ve got. I hope that he understands and that he doesn’t penalise us with this, and I’m almost certain he’ll listen to us.”
Argentine Production Minister Dante Sica said Trump’s announcement was “unexpected” and he was seeking talks with US counterparts. Additionally, Argentina’s Foreign Ministry said it will begin negotiations with the US State Department.
Trump also urged the Federal Reserve to prevent countries from gaining an economic advantage by devaluing their currencies.
“The Federal Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar,” Trump tweeted “Lower Rates & Loosen – Fed!”, he said.
Trump has repeatedly urged the Fed to lower rates to below zero, arguing that negative rates in Europe and elsewhere give those countries a competitive advantage.
However, Fed policymakers have been reluctant to take the unorthodox policy steps tried by other global central banks. The US central bank’s policymaking committee holds its next meeting on Dec 10-11.