Tariffs On Steel and Aluminum May Spark Global Trade War
March 05, 2018
Trump’s tariffs spark NAFTA, trade war concerns; Trump approves Arkansas Medicaid work requirements; Activity in the US services sector of the economy slipped a bit in February, largely on limited employment growth.
- Trump’s tariffs spark NAFTA, trade war concerns. President Trump’s announcement that he intends to institute tariffs of 25 percent on steel imports and 10 percent on imported aluminum has complicated the renegotiation of NAFTA, currently underway in Mexico City. The proposed tariffs have sparked concerns of a “trade war,” as Canadian and Mexican authorities have demanded exemption from the tariffs. German car stocks also fell as a result of the news, while much of the Republican leadership, long considered dogmatically in favor of free-trade, criticized the President’s move. The President does not appear to be wavering in his support for the tariffs, emphasizing the “bad deal” the US was getting during a meeting with Prime Minister of Israel Benjamin Netanyahu. The most recent round of NAFTA negotiations will end without a trilateral statement, a concerning sign for the trade deal’s uncertain future. [Reuters]
- Trump approves Arkansas Medicaid work requirements. Arkansas is now the third US state with federal permission to demand Medicaid beneficiaries work in order to receive health care coverage, as of Monday. The work requirements force recipients to work or participate in job search and training activities 80 hours per month to receive coverage. The requirements are set to go into effect beginning June 1, the earliest date of any state yet. The state did not get permission to roll back eligibility requirements, which would have reduced coverage by 60,000 recipients. [The Hill]
Economic Indicators & News
- Service sector slips while orders at 12-year high. Activity in the US services sector of the economy slipped a bit in February, largely on limited employment growth, but new orders were at a 12 and a half year high. Monday’s survey from the Institute for Supply Management showed non-manufacturing activity falling slightly to 59.5, still expanding but less than previous months. Economists indicated the drop in services growth was to be expected, as January’s reading showed unsustainable growth levels. Economists surveyed continue to expect job growth in the month of February. [Reuters]