U.S. President Donald Trump announced on Sunday that he would soon reveal a tariff rate on imported semiconductors, signaling an impending shift in trade policies that may impact a wide range of electronics, including smartphones and computers. Trump told reporters aboard Air Force One that flexibility would be extended to some companies in the semiconductor sector, but emphasized a shift towards domestic production.
“We want to make our chips and semiconductors here in the United States,” Trump said as he returned to Washington from his estate in West Palm Beach. He hinted that some products, including smartphones, might still be exempt but emphasized that “you have to show a certain flexibility.”
Trump’s announcement came after a national security trade probe into the semiconductor industry, which the administration is considering under the umbrella of a broader tariff investigation. On social media, Trump reaffirmed the administration’s focus on the entire electronics supply chain.
This move is expected to reverse previous exemptions for consumer electronics from the reciprocal tariffs placed on Chinese goods. On Friday, the White House had announced these exclusions, which were seen as offering some relief to the tech industry and consumers, but Trump’s subsequent remarks suggest the reprieve will be short-lived.
Commerce Secretary Howard Lutnick clarified that new duties targeting critical Chinese technology products, such as smartphones, computers, and semiconductors, would be implemented in the coming months, adding more pressure to U.S.-China relations. These tariffs will be distinct from the existing reciprocal tariffs, which have already risen to 125% on Chinese imports.
The shift in tariff policies triggered intense market volatility, with the Standard & Poor’s 500 index falling by over 10% since Trump’s administration began in January. Analysts warned that the unpredictability of the tariff strategy was undermining business planning and investment.
Senator Elizabeth Warren, a Democrat, condemned the move as further evidence of the chaotic and unpredictable nature of Trump’s tariff policies. “There is no tariff policy—only chaos and corruption,” Warren remarked on ABC’s This Week.
Meanwhile, economist and investor Bill Ackman, who had supported Trump in his presidential bid but is critical of the tariffs, called for a temporary pause on tariffs for Chinese goods. Ackman suggested that a temporary reduction in tariffs could help U.S. businesses relocate supply chains from China without further economic disruption.
Critics like Sven Henrich, founder of NorthmanTrader, also slammed the constant changes in tariff policy. “U.S. business can’t plan or invest with the constant back and forth,” he tweeted.
Despite the rising tensions and criticisms, the U.S. government is reportedly pursuing negotiations with several countries on trade deals, while trade representatives continue to work with China to address the ongoing trade conflict. However, U.S. officials have expressed frustration with China’s retaliation and its role in global trade frictions.
As the debate over tariffs continues, some financial experts, including Ray Dalio, founder of Bridgewater Associates, expressed concern over the potential for the U.S. economy to slide into a recession. “We are at a decision-making point and very close to a recession,” Dalio warned, citing the economic risks tied to the escalating trade war.