Trade War Escalates: Trump’s Tariffs Trigger Global Economic Jitters
The seemingly endless saga of the US-China trade war takes a dramatic turn today. President Trump is set to impose a staggering 104% tariff on goods imported from China, escalating tensions and sending shockwaves through global markets.
This latest salvo follows China’s weekend announcement of a 34% tariff on US imports, a retaliatory measure responding to previous actions by the Trump administration. The tit-for-tat tariffs are raising serious concerns about the stability of the global economy.
The escalating trade conflict is fueling market volatility and drawing sharp criticism, even from within the US. Some high-profile American billionaires are openly condemning Trump’s policies, accusing him of instigating an “economic nuclear war” with potentially devastating consequences. The long-term impact on businesses and consumers remains uncertain.
Central Bank Inflation Target in Jeopardy?
New data released by the INE (National Statistics Institute) shows that the Consumer Price Index (CPI) for March rose by 0.5%, pushing the 12-month inflation rate to 4.9%. This means that inflation has already reached 2% in 2025, exceeding half of the Central Bank’s projected 3.8% for the entire year and nearing two-thirds of its 3% inflation target.
Economists are warning that this increased pressure on prices significantly reduces the likelihood of further interest rate cuts by the Central Bank, at least in the near term. The rising inflation creates a challenging environment for monetary policy.
“The risks ahead have changed,” explains Carolina Molinare of OCEC-UDP. “The exchange rate channel is gaining importance, as currency depreciation due to increased trade and geopolitical tensions can translate into prices, particularly affecting tradable goods, which represent approximately 80% of the CPI basket.” The impact of a weaker currency on import prices is a key concern.
PPD Regains Influence in Government
After a brief absence following Carolina Tohá’s resignation as Minister of the Interior, the PPD (Party for Democracy) is once again a key player in the government’s inner circle.
President Boric has announced that the Minister of Defense, Adriana Delpiano (PPD), will join the political committee at La Moneda, the presidential palace, effectively restoring the party’s influence in crucial decision-making processes. This move signals a renewed commitment to collaboration and inclusivity within the governing coalition.
“If the question is whether we care about being part of the political committee or not, naturally we do care,” stated PPD leader Jaime Quintana shortly after Tohá’s departure. “The President knows that it is not indifferent to us to be part of the most strategic area of his government.” The PPD’s return to the table reinforces its role in shaping the government’s agenda.
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