Back to today’s briefing

Story perspectives

U.S. Tariffs Surge to 18.4%, Threaten India's Growth

7/31/2025

50 10

Summary

U.S. Tariffs Impact

The U.S. average effective tariff rate may reach 18.4%, the highest since 1933, due to new tariffs.
A 25% tariff on Indian imports, starting August 1, could lower India's GDP growth by 0.2%.
Indian stock markets declined, reflecting concerns over impacts on textiles and pharmaceuticals.
Experts stress the importance of understanding additional penalties for a precise economic impact evaluation.

Summary

U.S. Economy Rebounds

The U.S. economy rebounded with a 3% annual growth rate in Q2, recovering from a 0.5% contraction in Q1.
A notable decline in imports, influenced by tariffs, significantly affected GDP calculations.
Consumer spending increased by 1.4%, yet average growth for the first half remained at 1.25%, revealing underlying weaknesses.
Economists anticipate slower growth as tariffs continue to affect prices and consumer confidence.

History

Historical Context

The Smoot-Hawley Tariff Act of 1930 raised U.S. tariffs to an average of 47%, peaking at nearly 60% due to deflation during the Great Depression. This legislation is often blamed for exacerbating the economic downturn by provoking retaliatory tariffs and reducing global trade. Current U.S. tariffs, averaging 18.4%, echo this historical misstep, raising concerns about economic stability and consumer confidence.

1 of 3

U.S. Tariffs Impact

The U.S. average effective tariff rate may reach 18.4%, the highest since 1933, due to new tariffs.
A 25% tariff on Indian imports, starting August 1, could lower India's GDP growth by 0.2%.
Indian stock markets declined, reflecting concerns over impacts on textiles and pharmaceuticals.
Experts stress the importance of understanding additional penalties for a precise economic impact evaluation.

1 / 3