Tariff Update: Incorporating Recent Decisions and Deals

Marina Azzimonti and Acacia Wyckoff

Richmond Fed Economic Brief, 2025, vol. 25, issue 23

Abstract: In March, we introduced a benchmark measure of the average effective tariff rate (AETR), using detailed trade data for 2024. We subsequently updated this analysis to reflect the tariff announcements on April 2 (commonly referred to as "Liberation Day") and April 9. This article provides another update by incorporating recent court decisions involving these tariff announcements as well as trade agreements with the U.K. and China, described later in this article in more detail. As in our previous analysis, we report AETRs by country and industry. While the industry-level AETR reflects the direct cost of importing goods into a specific sector, it does not account for broader production linkages across the economy. Since industries rely on inputs from both domestic and foreign sources (including inputs from other sectors), we complement this measure with an "impact factor" that estimates how tariffs affect the cost of intermediate inputs used in production. We construct this metric using input-output data from the Bureau of Economic Analysis (BEA) to capture the upstream exposure of each industry to tariffs. While the measure does not account for changes in wages, investment behavior or supply chain restructuring, it provides a first step toward identifying which sectors and geographical regions are most vulnerable to proposed tariff increases.

Keywords: tariffs; trade; trade and international economics (search for similar items in EconPapers)
Date: 2025
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