Daily Trump Tariff Update: Indonesia at 19% and More
On Tuesday, confusion mounted when President Trump said that he had made a deal with Indonesia. Under the new agreement, the U.S. will impose a 19% tariff against Indonesia.
The impact on trade is minimal, since Indonesia is a small exporter of goods to the U.S. As a result, stock markets are watching the European Union’s reaction to tariffs imposed on it. The EU does not want tariffs higher than the baseline 10%.
Indonesia traded around $40 billion worth of goods with the U.S. last year. U.S. exports to Indonesia increased by 3.7% in 2024, compared to imports rising by 4.8%. The trade deficit between the two countries is around $18 billion.
On Monday, Trump pressured Russia to have a peace deal within 50 days. Otherwise, the U.S. would impose secondary sanctions. This differentiation compared to Biden-era sanctions matters. It would punish countries that buy oil from Russia. China, India, and Germany. Commerce Secretary Lutnick had to clarify that when Trump spoke of tariffs on Russia, he meant secondary tariffs.
The latest threat against Russia complicates negotiations with the EU.
After the news, the U.S. dollar continued its technical rebound. The USD index bullish fund (UUP) closed at $27.44, at its 50-day simple moving average. However, the 20+ Year Treasury Bond (TLT) fell after a monthly peak above $88. It closed on Tuesday at $85.01.
