Executive Summary 

• The Biden administration’s announcement last week of new tariffs targeting China represent a relatively surgical approach with only a limited expected economic impact.
• This stands in contrast to Trump’s proposal for blanket tariffs on imports, which could have a more material economic impact.
• Investors should remain alert to potential market volatility associated with trade policy uncertainty.

• The Biden administration announced a new round of tariffs targeting Chinese imports of batteries, metals, medical supplies, electric vehicles and other goods.
• The scope of goods impacted by the tariffs is relatively small, affecting only $19 billion of imported goods with a total tariff price tag of 0.01% of GDP.
  
  

• The new round of tariffs underscores a unique political alignment regarding confronting China’s trade practices, but also highlights key differences in approach. 
• The Trump administration’s tariffs implemented from 2018 to 2020 were a modest headwind to economic growth, but proposals made on the campaign trail appear to be of larger magnitude. 
• Trump’s proposed tariffs would likely be larger in scope than those announced by Biden, but would likely be used to fund key tax cut extensions. 

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