It didn't take long for U.S. allies to retaliate against President Donald Trump's 25% tariffs on all steel and aluminum imports, which went into effect on Wednesday.
Europe said it would impose tariffs on about $28 billion worth of U.S. goods starting April 1. Canada also said it would impose tariffs on American imports beginning on Thursday.
According to the U.S. Commerce Department, the nation imported over $58 billion worth of aluminum, steel, and iron last year. Many economists anticipate that companies will pass on part or all of the increased costs to consumers.
Consumers could see price hikes in various sectors, including the automotive industry, where auto prices may rise. Homebuilders have already reported that the tariffs have disrupted their industry. Additionally, prices may increase for a range of products, such as appliances, machinery, infrastructure materials, medical devices, power lines, and beverage cans, among others.
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Tariffs are fees charged to companies to import their goods from another country. Many economists believe that most companies will pass the cost of a tariff to the consumer instead of absorbing the fee.
According to research released in October 2024 by Georgia State University, Arizona State University, and Colorado State University, tariffs might not only cause an increase in prices for consumers but they can also disrupt supply chains.
"While tariffs can provide some protection to certain industries, they can also create inefficiencies for the industries they were designed to protect, as well as for their supply chain partners," the study said. The disruption to the supply chain could cause additional challenges to the economy."
President Trump has defended the tariffs by saying they will create jobs and revenue.
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"All I know is we're going to take in hundreds of billions of dollars in tariffs, and we're going to become so rich you're not going to know where to spend all that money. I'm telling you, you just watch. We're going to have jobs, we're going to have open factories. It's going to be great," he said.
