A U.S. federal court has ruled that former President Donald Trump’s sweeping tariffs were imposed illegally, dealing a significant blow to his economic policies.
The Court of International Trade determined that Trump exceeded his authority by invoking emergency powers to justify tariffs on nearly every country.
The ruling states that the U.S. Constitution grants Congress exclusive power to regulate commerce, meaning the president cannot unilaterally impose such broad trade restrictions.
The decision immediately halted the 10% tariffs Trump had imposed on most U.S. trading partners, as well as additional levies on China, Mexico, and Canada.
The court found that the International Emergency Economic Powers Act (IEEPA), which Trump cited as justification, does not grant him the authority to implement such sweeping trade measures.
The White House swiftly filed an appeal, arguing that the tariffs were necessary to address trade imbalances and safeguard American industries.
However, businesses and state governments that challenged the tariffs welcomed the ruling, citing concerns over inflation and economic harm.
Dow Jones Industrial Average Futures 28th & 29th May 2025 after the court ruling
Markets responded positively to the decision, with stock futures rising and the U.S. dollar strengthening. If the ruling stands, businesses that paid the tariffs may be eligible for refunds, marking a potential shift in U.S. trade policy.
The U.S. President is expected to find a workaround after suffering a major blow to a core part of his economic agenda.