The tariffs that jolted global trade markets and fueled Donald Trump’s aggressive economic doctrine aren’t going anywhere—for now. A federal appeals court in Washington has put the brakes on a lower court decision that declared Trump overstepped his authority, giving the former president’s sweeping duties a temporary lifeline.
The move came just a day after the U.S. Court of International Trade delivered a shock verdict, arguing Trump lacked the constitutional power to unilaterally slap tariffs on a slew of imports. The panel asserted that the Constitution hands tariff authority to Congress, not the Oval Office—even in an emergency.
But Thursday’s action by the Federal Circuit means the controversial duties, including the so-called “Liberation Day” tariffs targeting countries like Canada, Mexico, and China over fentanyl-related accusations, will remain in effect—at least until the appellate judges hear both sides. Plaintiffs must file responses by June 5. The government gets until June 9.
Inside the Beltway, Trump loyalists weren’t rattled. They’ve made it clear they’ll pursue any legal lever possible to keep the tariffs alive—whether by winning on appeal or dusting off other executive powers. Trump, meanwhile, responded with his usual fire on social media, calling the lower court’s ruling “horrible” and a “country-threatening decision.”
“If allowed to stand, this would completely destroy Presidential Power,” he fumed, claiming it would neuter the presidency and hand America’s trade policy to foreign powers cheering from the sidelines.
Reaction overseas was more measured. Britain called it a U.S. matter. Germany and the EU shrugged. But Canada’s Prime Minister, Mark Carney, didn’t hide his satisfaction, saying the ruling confirmed Canada’s long-standing view that the tariffs were out of bounds.
On Wall Street, traders wavered. Stocks nudged higher on hopes the judicial pushback might soften the economic fallout, but investors are clearly bracing for a drawn-out legal slog. The uncertainty is already spooking global negotiations and choking supply chains, particularly for companies that rely on international imports.
A second federal court ruling Thursday piled on, also faulting Trump for misusing emergency powers to impose what he called “reciprocal tariffs.” But that judgment applied only to a single toy company and won’t have wider implications—for now.
While some of Trump’s steel, auto, and aluminum tariffs (justified under national security claims) remain untouched by these rulings, the broader “Liberation Day” duties are in limbo. Those duties had pushed the average U.S. tariff rate up to about 15%—nearly triple what it was before Trump returned to office.
Multinationals are already pivoting. GM and Ford have walked back earnings forecasts. Non-U.S. players like Honda, Roche, and Campari are exploring reshuffles in their supply chains or planting deeper roots in the U.S. to shield themselves.
For the small businesses that brought the legal fight, the temporary stay is a speed bump—but not a defeat. Their lawyers argue these tariffs are an existential threat: suppliers lost, costs up, customers fleeing.
Whether the courts ultimately uphold Trump’s vision of presidential trade power—or take a scalpel to it—remains a question hanging over global markets and White House ambitions alike.
