In a series of tweets Thursday, US President Donald Trump announced that new tariffs would be imposed on some $300 billion worth of Chinese goods, noting that the move would take effect come September 1.
"Trade talks are continuing, and during the talks the US will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country," Trump wrote, later adding that he "looks forward to continuing our positive dialogue with China" on trade.
Trump's tweets came just a few days after a US delegation met with Chinese officials on Wednesday in Shanghai, marking the first face-to-face trade talks since the two nations decided on an economic ceasefire last month.
“The timing of this is, I think, meant to disrupt the trade talks, because the US, this week, entered another round of trade talks in Beijing to try to resolve this, and then Trump sort of pulled the rug out under his trade negotiators with this,” Ewing told hosts John Kiriakou and Walter Smolarek.
“There is one crazy idea … there’s this idea on Wall Street that the object of the tariffs is really to scare the Federal Reserve into another rate cut … It’s an interesting theory,” Ewing added.
“Wall Street people certainly don’t want all this crazy financial manipulation, because it destabilizes capitalism for them. These tariffs are going to raise the price of major cost of living for everyone in the US,” Ewing continued.
On Wednesday, the US Federal Reserve slashed interest rates for the first time in more than 10 years as it sought to “foster maximum employment and price stability.”
"In light of the implications of global developments for the economic outlook as well as muted inflation pressures, the Committee decided to lower the target range for the federal funds rate to 2 to 2-¼%,” a statement released Wednesday by the Federal Reserve’s policy-setting Federal Open Market Committee (FOMC) read.
Trump has repeatedly pressured the Federal Reserve to cut interest rates throughout his presidency.
The Federal Reserve System is the US central banking system established in 1913. The purpose of the Federal Reserve, according to its website, is to “conduct the nation’s monetary policy to promote maximum employment, stable prices and moderate long-term interest rates in the US economy.”
The Federal Reserve typically reduces interest rates to boost economic growth, because lower financing cost stimulates borrowing and investing. However, when federal rates are too low, the general price of goods and services in the economy can increase, a phenomenon known as inflation.
Stock markets fell after Trump's announcement of the new tariffs, with the Dow Jones and Nasdaq closing down 0.4% and 1.3% respectively by Friday. The S&P 500 dropped 0.7%. Technology analyst Dan Ives told Bloomberg the tariffs could cause Apple to sell between 6 million and 8 million less iPhones than it would have if the tariffs had not been imposed.