U.S. Treasury Chief Signals Imminent Tariff Cuts on Coffee and Fruit
U.S. Treasury Chief Janet Yellen said the economy was strong before the recent government shutdown and described the shutdown as a temporary hiccup. She signaled that in the coming days the administration will unveil major tariff cuts and exemptions, including tariff relief on coffee, bananas and other fruits. Yellen forecast that U.S. consumer confidence and economic conditions will improve in Q1 and Q2 of next year, with actual incomes rebounding. She reiterated that large-scale tax rebates will be distributed in early 2026 through multiple channels still under discussion. Yellen’s remarks follow former President Trump’s proposal of $2,000 rebates for households earning under $100,000. Traders will watch for details on the tariff cuts and rebate policy as potential catalysts for shifts in fiscal impact and market sentiment.
Bullish
Major tariff cuts on consumer goods like coffee and fruit can boost disposable income, improve consumer confidence and spur broader economic activity. Traders often interpret tariff relief as a bullish fiscal policy signal, increasing liquidity and risk appetite. Historically, announcements of trade policy easing—for instance, partial tariff suspensions in 2019—have led to positive rallies across asset classes, including equities and cryptocurrencies. In the short term, markets may rally on optimism over lower import costs and higher consumer spending. Over the long term, sustained tariff reductions can support GDP growth and strengthen market fundamentals, underpinning a prolonged bullish cycle.