- Commerce Secretary Wilbur Ross tried to downplay the implications of President Donald Trump’s decision to impose steel and aluminium tariffs on the European Union, Canada, and Mexico.
- Ross said the tariffs were “blips on the radar screen” in the relationship between the US and EU, saying the EU “will get over this in due course.”
- Ross dismissed concerns that the tariffs would increase costs for US consumers and harm the economy.
- He also said that despite the US stock market sell-off following the announcement, stocks would “adjust to facts” and bounce back.
One of President Donald Trump’s top economic advisers on Thursday downplayed the fraying US relationship with the European Union amid Trump’s latest trade escalation.
“These are blips on the radar screen. I don’t think they change the fundamentals of the relationship,” Commerce Secretary Wilbur Ross said on CNBC. “Everybody has spats every now and again, every family does, every country does with others, there’s nothing weird about that. I think everybody will get over this in due course.”
The US said Thursday that the EU would be subject to steel and aluminium tariffs beginning Friday after negotiations to extend exemptions failed to gain traction.
European leaders have also criticised Trump’s decision to pull out of the Iran nuclear agreement earlier in May and expressed disappointment when Trump pulled the US out of the Paris climate agreement in 2017.
During the CNBC appearance, Ross also sought to downplay the economic and market downsides of the tariffs. US businesses that rely on imported metals warned that the tariffs will pressure their costs and force price increases, but Ross said consumers would only see a “trivial increase” in what they pay for goods.
“The beer, soft drink and soup cans, it’s all a fraction of a penny on each of those,” Ross said. “In terms of an automobile, it’s also a fraction of one per cent. And for the economy overall, it’s a very small fraction of 1%.”
Ross also dismissed concerns regarding the EU’s threat to impose tariffs on a little over $US3 billion worth of US goods, including motorcycles and blue jeans.
“Well, you’d obviously have to talk to the EU, but think about how small in number $US3 billion of product is relative to our $US18 trillion economy, It’s a tiny, tiny fraction of 1%.”
US stock markets sank after the tariff announcement, but Ross tried to brush off the decrease by pinning some blame on a weaker than expected print for US new home sales.
“One-hundred and seventy points is not very cataclysmic in any event,” Ross said. “Naturally the market, to the degree it was surprised, it will have to adjust to that but markets adjust to facts.”
Following Ross’s comments, the Dow Jones industrial average fell further and was down 230 points, or 0.95%, as of 11:10 am ET.
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