US president Donald Trump has said he will sign an order imposing 10-percent tariffs on all global imports later today, replacing many of the levies ruled illegal by the Supreme Court this morning. In a press conference punctuated by accusations of foreign meddling in American courts, the president said the new duties will be implemented under Section 122 of the Trade Act of 1974, implying that there can be no carveouts for specific product groupings, and that the government will have 150 days to gain Congressional approval before they expire. During that time, Trump said his administration would begin investigations under Section 301 as it seeks to implement a more permanent framework.

It isn’t clear how the new tariffs will interact with those put in place under other legal authorities, or if they will “stack” on top of levies negotiated under various trade agreements. We believe that the administration will have the authority to exempt certain countries—like Canada and Mexico—which have agreements in place, but our theory has not been legally tested, and there’s some ambiguity in the wording of the Act. If no exemptions are put in place, the effective average tariff rate applied to all US imports could rise slightly relative to the levels assumed a few hours ago.

Market reaction has been muted, given that some investors had feared Trump would enact the maximum 15-percent tariff allowable under Section 122, and are somewhat relieved by the outcome. The dollar is slipping, Treasury yields are trimming an earlier advance, and equity markets are returning some of their gains.

We’ll be back in your inboxes if there are any material developments, but if not, have a great weekend, and enjoy watching Canada winning some gold on Sunday morning.