Trump's Tariff Twist: Auto Industry Gets a Breather

President Trump suggested a temporary tariff exemption for the auto industry to allow carmakers to adjust supply chains. Despite previous plans for permanent tariffs, Trump's changing stance has fueled uncertainty. Financial markets face volatility as Trump seeks to balance trade policies with economic impacts.

President Donald Trump indicated on Monday that he may temporarily exempt the auto industry from tariffs, offering carmakers a reprieve to adjust their supply chains.

Trump, speaking in the Oval Office, noted the need for automakers to relocate production from Canada, Mexico, and other locations, underscoring the necessity for time to make such transitions. The move signals potential reversals on tariffs, as the financial markets react to escalating uncertainty.

Previously, Trump had lowered broader tariffs to a baseline 10 per cent for 90 days to enable negotiations, while increasing Chinese import taxes to 145 per cent. Trump's fluctuating trade policies have spurred confusion, with market responses reflecting concerns over future economic implications.

(With inputs from agencies.)