Trump’s scams weaken the dollar instead of strengthening it – which adds to the price that the Americans will pay for more expensive imports

• The US dollar has decreased While President Donald Trump raises his definitions, and he slips after revealing its most severe duties than expected on “Tahrir’s Day”. This contradicts what the markets expected before it launched its trade war. Greenback makes the weakest imports more expensive, adding costs from Trump’s aggressive taxes to import.

President Donald Trump’s tariff has criticized the dollar, challenges expectations to obtain stronger greenery and in addition to the price that the Americans will pay after import taxes.

To date this year, the US dollar index, which tracks Greenback against a basket of other global currencies, has decreased by 4.7 % with the increase in the price of investors in the economic impact of the duties expansion group.

After imposing a tariff on China, Canada, Mexico, steel, aluminum and cars earlier this year, Trump shocked global markets on Wednesday with a new tariff on almost every commercial partner that was more slope than expected.

Fitch classifications estimated that the total effective tariff rate would be about 25 % –The highest since 1909– Its previous estimate is 18 % and more than 10 times last year of 2.3 %. As a result, JPMorgan economists raised recession to 60 % of 40 %.

The “Liberation Day” announcement sent the dollar index to more than 2 %, which represents the worst loss for one day in nearly 10 years, which led to an early decrease as the fixed excavation of previous definitions has eaten views on the American economy and American assets.

But it was not supposed to be this way. During the presidential campaign and after that, the Trump trade in Wall Street included a bet that the customs tariff would tend to balance exports and imports in favor of the United States and raise the dollar. Instead, the actual definitions that Trump Drakonia revealed to the extent that it ended the “American exception” to the extent that the American economy and financial markets have boasted.

It is expected that companies will accommodate some tariff costs and transfer the rest to consumers. Through some estimates, the additional cost of auto tariffs alone may mean an increase in prices from 5,000 to 10,000 dollars per vehicle.

Meanwhile, former Treasury Secretary, Larry Samars, said that the total net impact of definitions will cost a four -dollar family.

Moreover, the weakest dollar will lead to high import prices from some countries. For example, a car from Germany will be translated at a price of 50,000 euros to about $ 55,000 at a exchange rate on Friday of $ 1.095 per euro – before collaboration in definitions.

This powerful limit is about $ 4,000 more than early January, when Trump’s trade was at its peak and the exchange rate was $ 1.02 per euro, with speculation investments that equal may be possible again.

On the other hand, the strongest dollar would make imports cheaper. During his confirmation session in January to the Treasury Secretary, Scott Pesin said The dollar can estimate 4 % In response to a 10 % tariff, “so 10 % is not passed” to consumers.

For his part, Trump said at the end of last week that if prices rise on foreign cars, consumers will buy American cars, as he ignored the concerns that the customs tariff for cars will lead to the high prices of cars.

He said at the sameInterview with NBC Newson saturday.

“I couldn’t care less. I hope to raise their prices, because if they did so, people will buy American -made cars. We have a lot.”

This story was originally shown on Fortune.com