Market "immune" to Trump's tariff threats? Economists: Only about a quarter are actually implemented.

In less than three weeks, President Trump of the United States has consecutively issued four broad-ranging tariff threats. According to past practices, such measures should have triggered intense fluctuations among investors, anxiety among corporate executives, and prompt economists to rapidly lower growth expectations for the countries involved. However, the latest situation shows that the financial markets and the business community have relatively lukewarm responses. Whether it is targeting Iran's trade partners, countries supporting Greenland, or tariff warnings against Canada and South Korea, the market generally sees them as "pressure tools" used more for gaining negotiation leverage or compelling the other party to change behavior, rather than definite policy actions that Trump will surely carry out. Recent analysis indicates that Trump doesn't always "back down at the last minute," but the actual implementation rate of his tariff threats is indeed limited. Research has found that ultimately only about one-fourth of Trump's tariff threats will be implemented. Data shows that around 43% of the tariff threats Trump issues are eventually withdrawn. Sometimes Trump would claim to have achieved a "victory," or the measures have not been officially implemented yet. Economists Nicole Gorton-Caratelli and Chris Kennedy reviewed the 49 tariff threats or new trade investigations proposed by Trump since the November 2024 election until this Sunday (excluding the latest targeting South Korea). The study found that more than half of the threats have not been fully implemented. In terms of the timing distribution, the measures that have actually been implemented or entered the investigation stage mainly concentrated between February and September. Monthly statistics also show that as the "cost of living pressure" in the United States became a political burden at the end of last year, Trump's tariff threats significantly decreased by the end of the year, indicating a certain correlation between his strategy and public support. The two economists wrote in their report: "This pattern is not entirely consistent, but overall, Trump often withdraws the most eye-catching, impactful threats, especially those that may significantly raise actual U.S. tariff levels or disrupt measures to trade truce with China." Market participants consider Trump's tariff rhetoric more as a "negotiation strategy" rather than an immediate policy path for implementation. Investors' sensitivity to his threats is decreasing, but if some measures are eventually realized, they may still have an impact on global trade and market sentiment.