President Donald Trump announced on Monday, Dec 2, that he will impose tariffs on imports from Argentina and Brazil on steel and aluminum. The decision is the result of the devaluation of their respective currencies, which has hurt U.S. farmers. Also, the president asked the Federal Reserve to take measures so that other countries do not devalue their currencies.
“Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries.”
“The Federal Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies. This makes it very hard for our manufactures & farmers to fairly export their goods. Lower Rates & Loosen – Fed!” he added.
…..Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies. This makes it very hard for our manufactures & farmers to fairly export their goods. Lower Rates & Loosen – Fed!
— Donald J. Trump (@realDonaldTrump) December 2, 2019
Trump had previously expressed disagreement with Federal Reserve leader Jerome Poswell for not cutting interest rates as much as the president would have liked.
Last October’s meeting between the Republican president and the Federal Reserve cut short-term interest rates for the third time a year to try to support the U.S. economy, although it also said it planned no further interest rate cuts absent clear evidence of a worsening U.S. economic outlook.
According to the AP News report, Argentina is immersed in a crisis, widespread poverty and severe inflation.
For its part, Brazil fights unemployment and is heading towards its third consecutive year of growth of approximately 1% after two years of deep decline, according to the same report.
Faced with this situation, Argentina responded that the Ministry of Foreign Affairs will begin to negotiate with the State Department. On the other hand, the Brazilian president, Jair Bolsonaro, has planned a meeting with Trump to discuss the issue, according to Fox Business.
Both Latin American countries benefited from the U.S.-China Trade War, as they were able to export more agricultural products to the Asian country because of Chinese import duties on U.S. agricultural products.
President Trump has been a staunch defender of farmers’ interests. The ‘trade war’ with China hurt U.S. farmers because of Beijing’s retaliation, which consisted of hundreds of millions of dollars in taxes on products made in China. To make up for the farmers’ losses, President Trump allocated $30 billion.