April 2025 Tariff Commentary

On Wednesday April 2, President Trump announced a sweeping set of reciprocal tariffs, marking one of the most aggressive shifts in U.S. trade policy in over a century. As global markets digested the implications, volatility surged, with the S&P 500 falling by more than 10% in two trading days — its steepest daily declines since March of 2020. Investors are grappling with the uncertainty surrounding these tariffs, which threaten to disrupt global supply chains, increase input costs for businesses, and potentially slow economic growth.

The longer-term impact remains highly uncertain, as much will depend on how these tariffs are implemented, whether they face legal or legislative challenges, and how key trading partners respond. While protectionist measures are often framed as a means to strengthen domestic industries, history suggests that tariffs can also lead to higher consumer prices, retaliatory actions from trading partners, and reduced corporate investment. However, the evolving political landscape and the potential for negotiations could ultimately shape how these policies play out.

Markets will likely remain volatile in the near term as businesses, policymakers, and economists assess the broader implications of this policy shift. As always, we emphasize the importance of diversification, disciplined portfolio management, and a cautious approach to any decisions in the short term.