Supreme Court strikes down Trump’s tariff regime, doesn’t rule on refunds
The Supreme Court of the United States this morning ruled against Donald Trump’s use of the International Emergency Economic Powers Act to impose tariffs, but declined to rule on firm’s eligibility for refunds, meaning that importers will be left to pursue claims through the Court of International Trade. At first glance, the ruling should reduce tail risks for market participants. The threat of abrupt and unilateral changes in US tariff rates has been a persistent source of volatility premia in foreign exchange, particularly for export-sensitive currencies. By narrowing the scope for executive action and lengthening the policy transmission lag, the...