President Donald Trump just can’t stop mentioning tariffs. Stock markets dipped slightly Friday after Trump threatened a 50% tax on imports from the European Union as well as a 25% surcharge on products from the tech titan Apple. The S&P 500 notched a daily decrease of 0.7% and a weekly drop of 1.7%. The Nasdaq had a daily decline of 1%, and the Dow Jones fell 0.6%.
Trump threatened tariffs in a pair of Friday morning posts on Truth Social, the social network he owns. “The European Union, which was formed for the primary purpose of taking advantage of the United States on TRADE, has been very difficult to deal with,” he claimed, adding that he’ll recommend a 50% tax on goods from the EU.
As for Apple, Trump threatened “at least” a 25% tariff against the tech company if it doesn’t move factories that manufacture the iPhone to the U.S. Even though a tariff on a multinational company would be rare in the modern era, Apple’s shares fell 3% on Friday.
Trump’s Friday pronouncements is an about-face from a more conciliatory position on tariffs his administration took in recent weeks, which itself was a pivot from its more aggressive stance in early April.
On April 2, the 47th president unveiled a base 10% tax on imports from the U.S.’s trading partners, as well as more severe tariffs on dozens of countries, especially China. The stock and bond markets shuddered in response, and Trump walked back his tariff plans soon after—excluding the taxes it levied against the People’s Republic.
Last week, however, the U.S. And China agreed to a 90-day pause on their trade war, during which the U.S. Would reduce its tariffs on Chinese goods to 30% and China would reduce its tax on American exports to 10%. In response, the markets rallied and posted a weekly gain.
“The economy still looks set to slow decisively but avoid recession, provided the administration refrains from imposing additional tariffs this summer,” Samuel Tombs and Oliver Allen, economists at Pantheon Macroeconomics, wrote in a May research note, published before Trump took to Truth Social on Friday.
The recent downgrade in Moody’s rating of U.S. Credit has also weighed on markets. The credit ratings agency dropped its ranking of American debt from AAA to a rating of one rung below at Aa1 because of “the increase over more than a decade in government debt and interest payment ratios to levels that are significantly higher than similarly rated sovereigns,” it said last week.