A federal appeals court ruled on Friday that President Trump's global tariffs were illegal. The ruling stated that the president exceeded his authority in using emergency powers to impose them, Bloomberg reports.

The judges allowed the tariffs to stay in place as the case continues to be adjudicated in a lower court. Friday's decision from the US Court of Appeals for the Federal Circuit reaffirms an earlier ruling by the Court of International Trade.

Brazilian President Luiz Inacio Lula da Silva has authorized plans to retaliate against the 50% US tariffs imposed by President Trump, though the Brazilian leader emphasized he is looking to negotiate with the US administration.

"This is a somewhat lengthy process, and I'm in no hurry to do anything about reciprocity against the US," Lula said.

Separately, the $800 duty-free loophole ends Friday, with small imported packages to the US facing tariffs of 10% to 50%, depending on their origin.

The European Commission proposed on Thursday to withdraw all tariffs on imported US industrial goods in a bid to speed up the removal of US duties on European cars.

The proposal is the first step in enacting the framework agreement between Trump and Commission President Ursula von der Leyen, which was established last month. Trump requested the removal of tariffs before the US lowers its duties on the bloc's auto exports.

Meanwhile, Mexico is set to join the US with tariffs and will raise duties on Chinese goods under its 2026 budget plan, Bloomberg reported on Wednesday. The proposal, due next month, targets cars, textiles, and plastics to shield local industries from cheap imports.

US pressure on Mexico stems from Trump's claim that cheap Chinese goods slip into Mexico before heading north.

Meanwhile, Trump's 50% tariffs on India have now kicked in, a move that experts say could upend a decades-long push by Washington to forge closer ties with New Delhi. Trump added an extra 25% tariff on Indian imports because of the country's purchase of Russian oil.

The unfolding situations with both India and Mexico are the latest examples of how Trump's tariffs are pushing countries to choose sides between the US and China.

Earlier in August, Trump unveiled "reciprocal" tariffs on dozens of US trade partners (which you can see in the graphic below).

Those tariffs face legal limbo in an appeals court case that could be decided within days.

Justice Department lawyers and lawyers for a group of small business importers who are challenging the tariffs imposed under this authority argued their positions before the US Court of Appeals for the Federal Circuit. If the court rules against the government, it's likely Trump would appeal to the Supreme Court.

Read more: What Trump's tariffs mean for the economy and your wallet

Here are the latest updates as the policy reverberates around the world.

Imports to the US surged in July, widening the US trade deficit 22.1% to $103.6 billion last month, the Census Bureau said on Friday.

Imports of goods jumped $18.6 billion to $281.5 billion, while goods exports dipped $0.1 billion to $178 billion.

The effect of the growth in imports could drag on economic growth in the third quarter.

More from Reuters:

An ebb in import flows led to a sharp contraction in the trade deficit in the second quarter, which added a record 4.95 percentage points to gross domestic product growth that period.

The economy grew at a 3.3% annualized rate last quarter. GDP contracted at a 0.5% rate in the January-March quarter, weighed down by a sharp deterioration in the trade deficit that was driven by businesses front-running imports at a record pace before President Donald Trump's sweeping tariffs kicked in.

The Atlanta Federal Reserve is currently estimating GDP will increase at a 2.2% rate in the third quarter.

Read more here.

Yahoo Finance reporter Emma Ockerman looks into the de minimis exemption, which is ending on Friday, and its effects on businesses and consumers:

Last week, the women’s shoe brand Zou Xou offered consumers a “pre-tariff” sale of 10% to 50% off, warning that prices were set to rise. Similarly, the activewear brand Girlfriend Collective said in an Aug. 21 email blast about a sale that “in nine days our prices get a little higher, but we still promise to make sustainable, high-quality clothes you can wear for years.”

The timing of the discounts hit as a loophole allowing cheaper imported packages to avoid steep levies comes to an end.

“I just framed it as an opportunity to save before the deadline,” said Katherine Theobalds, the Buenos Aires-based founder of Zou Xou. She manufactures and ships her artisanal leather shoes from Argentina, which has been hit with 10% tariffs.

The de minimis exemption allowed millions of shipments into the US each day duty-free if they were valued at or below $800.

But President Trump announced in late July that he would eliminate the policy, effective Friday. That decision, which sent direct-to-consumer companies and small businesses scrambling, subjects smaller imported parcels to tariffs moving forward, though gifts of less than $100 between individuals will not be taxed.

Read more here.

Bloomberg reports:

Caterpillar Inc. (CAT) is warning investors that it’s now expecting tariffs to have an impact of as much as $1.8 billion on the company this year, higher than its guidance in early August.

“While the company continues to take initial mitigating actions to reduce this impact, trade and tariff negotiations continue to be fluid,” Caterpillar said Thursday in a regulatory statement.

The company said it expects the net impact from incremental tariffs introduced this year to be $500 million to $600 million in the third quarter, and $1.5 billion to $1.8 billion for the full year.

Read more here.

Brazil's Vice President Geraldo Alckmin said Thursday that President Luiz Inacio Lula da Silva has authorized retaliation against President Trump's 50% tariffs.

A source added that the US will be officially notified on Friday, confirming a report from Brazilian newspaper O Estado de S. Paulo.

Bloomberg News reports:

The plan, an initial step designed to encourage talks before escalating a trade war, was discussed during a meeting between Lula and cabinet ministers on Wednesday, the person said.

“I hope this helps accelerate dialogue and negotiation,” Alckmin said.

Brazil’s Chamber of Foreign Trade now has as many as 30 days to analyze the US measures and determine whether they fall under the reciprocity law passed by Congress earlier this year. If the chamber approves, a group of ministries will study which countermeasures to apply.

Read more here.

Global grain traders are closely watching the US-China talks for any insight on agricultural tariffs. The outcome could be key for American farmers trying to regain access to their top export market.

Reuters reports:

Senior Chinese trade negotiator Li Chenggang is visiting Washington this week for talks with U.S. officials.

WHY DOES AGRICULTURE MATTER FOR TIES?

Farm products are the biggest U.S. export to China and a commitment by Beijing to increase purchases is likely to feature in a broad trade deal. President Donald Trump has already urged it to quadruple soybean purchases.

But looming over the talks is the memory that parts of the 2020 \\"Phase 1\\" deal, struck during Trump's first term, went unfulfilled, in particular a commitment by Beijing to buy an additional $200 billion worth of U.S. goods over 2020 and 2021.

Read more here.

The US's relationships with India and Mexico highlight how President Trump's trade disputes are starting to polarize nations.

Yahoo Finance's Ben Werschkul reports:

President Trump’s trade wars are increasingly forcing countries to choose between the US and its main adversaries, China and Russia.

It’s a theme that has been evident for months but has been on heightened display this week, with headlines from India to Mexico underscoring that nations are not necessarily destined to choose the US.

On one side is India, which is now facing 50% US tariffs on an array of goods. Those duties are set to be felt in everything from textiles to solar panels in part due to the country’s continued purchases of Russian oil.

But a US pressure campaign to stop those purchases has, for now at least, clearly pushed India toward US adversaries.

Read more here.

On Thursday, the European commission proposed removing tariffs on US industrial goods, a step that could trigger a retroactive cut in US tariffs on European cars. President Trump has already agreed to cut tariffs on cars built in the European Union but this latest move by the EU could be seen as a way to speed this up.

Reuters reports:

The proposal is the first step in enacting the framework agreement between U.S. President Donald Trump and Commission President Ursula von der Leyen on July 27, which saw the EU accept a broad 15% tariff to avoid a damaging trade war.

The United States has agreed to reduce its tariffs on cars built in the European Union to 15% from 27.5% from the first day of the month in which the EU's legislative proposal is presented - meaning from August 1.

Read more here.

A Canadian boycott in protest of the Trump administration's tariffs is hitting Jack Daniel's maker Brown-Forman (BF-B, BF-A) hard.

Brown-Forman's sales in Canada fell sharply by 60% as the distiller called out \\"significant headwinds\\" due to the US-Canada trade dispute.

In March, most Canadian provinces, including Ontario, Quebec, and British Columbia, retaliated against President Trump's tariffs on Canadian goods by pulling US liquor from retail locations. Only two provinces, Alberta and Saskatchewan, have since put US liquor back on shelves.

\\"Canada's organic net sales declined nearly 60% as beverage alcohol products produced in the United States remained off the shelves in the majority of the Canadian provinces,\\" Brown-Forman CEO Lawson Whiting said in the company's earnings call. \\"While our non-U.S. brands, such as Diplomatico and El Jimador, continued to deliver growth, they were not able to offset the decline of our brands that are produced in the US.\\"

Tens of thousands of small businesses in India are rushing to find new buyers in markets across Europe, Africa and Asia in order to lessen the impact of President Trump's 50% tariffs on exports to the US, which came into effect on Wednesday.

Reuters reports:

Firms also front-loaded shipments earlier in August ahead of the August 27 deadline, sending out existing orders before tariffs were doubled from the 25% import tax imposed by US President Donald Trump in July.

Over 50,000 exporters among India's nearly 60 million small enterprises, spanning sectors including textiles, jewelry and chemicals, face the tariff spike but the government has yet to announce any financial or credit support for those affected.

It has instead urged exporters to find alternative markets.

\\"The sense we are getting is that a lot of the times we try to actually sell to the US because we get better pricing. But there are a lot of other markets and it is those markets that are now going to come into focus,\\" said Vinod Kumar, president of the India SME Forum.

Read more here.

Bloomberg News reports:

HP Inc. gave a profit outlook for the current quarter that was in line with expectations, but investors remain concerned about the impact of economic uncertainty and higher costs tied to President Donald Trump’s trade policies.

To cope with the effects of tariffs, HP has adjusted to use manufacturing facilities outside of China for almost all of its products sold in North America, and the company has increased some prices, Chief Executive Officer Enrique Lores said in an interview.

The company was able “mitigate the majority of the tariff costs in Q3, while still delivering EPS slightly above the midpoint of our guide,” Chief Financial Officer Karen Parkhill said in response to analysts’ questions during a conference call after the results were released. “As we’ve said, we do expect to fully offset these trade-related costs as quickly as possible. And the full benefit of our mitigating actions really depending on the scope can take a little bit of time. But again, we expect to fully mitigate as quickly as we can.”

Read more here.

Oil fell on Thursday as traders continued to monitor the situation between the US and India, after President Trump hit New Delhi with 50% tariffs over its purchase of Russian oil.

Bloomberg News reports:

Brent (BZ=F) dropped below $68 a barrel, having traded between $65 and $70 for virtually all of August. White House trade adviser Peter Navarro stepped up the pressure on New Delhi to halt purchases of Russian oil after Washington doubled a levy on imports from the country to 50%. The US has singled out India over Russian crude imports as part of its efforts to end the war in Ukraine.

“Tariffs and sanctions related to Russia, as well as attacks on Russian oil facilities have kept oil prices resilient in the high $60s, despite the looming oversupply that should lower prices,” Citigroup analysts including Anthony Yuen said in a note.

Read more here.

Bloomberg reports that the Mexican government plans to raise tariffs on China as part of its 2026 budget proposal next month. The move is aimed at protecting domestic industries and acquiescing to a request from President Trump.

From Bloomberg:

The tariff hikes, expected for imports including cars, textiles, and plastics, aim to shelter domestic manufacturers from subsidized Chinese competition, according to three people briefed on the matter, who asked not to be identified, revealing details of the plans. Other Asian countries are also expected to face higher tariffs, one of the people said.

Specific tariff rates weren’t immediately clear, and the plan could change, the people said. The draft revenue proposal from President Claudia Sheinbaum’s administration is scheduled to be sent to Congress by Sept. 8.

Read more here.

Japan's top trade negotiator, Ryosei Akazawa canceled a last-minute trip to Washington on Thursday, delaying talks on a $550 billion investment package Tokyo has offered in return for relief from heavy tariffs. Akazawa had planned to finalize the deal in writing, including how investment returns would be shared between the US and Japan.

Reuters reports:

US Commerce Secretary Howard Lutnick has also said there would be an announcement this week on Japan's investment.

\\"It was found that there are points that need to be discussed at the administrative level during coordination with the American side. Therefore, the trip has been cancelled,\\" Japan's government spokesperson Yoshimasa Hayashi told reporters on Thursday.

Washington and Tokyo agreed in July to set a reduced 15% tariff on imports from Japan in exchange for the package of U.S.-bound investment through government-backed loans and guarantees, but details of its contents remain unclear.

Read more here.

Abbott Laboratories (ABT) is bracing for the impact of higher tariffs, including a 50% US levy on its Indian imports.

\\"Our impact between the whole network is just under $200 million,\\" CEO Robert Ford said on Yahoo Finance's Opening Bid (video below). \\"But I think the key thing here, one thing that we have learned, is once tariffs come into place, whether in the United States or in another country, they do not go away.\\"

Ford added the healthcare company is finding ways to mitigate the tariffs, including making long-term investments in manufacturing and supply chains.

The Illinois-based Abbott has about 90 manufacturing sites worldwide, with roughly 40 of those in the US, per Ford. The Trump administration has unleashed a torrent of tariffs, including 50% on India, a major pharmaceutical producer.

“A very large percentage of our US revenue is supported by US manufacturing, and our international revenue is supported by international manufacturing sites,” he said. That strategy helps buffer the company from foreign exchange swings but builds supply chain resilience.

\\"Once tariffs come in place, whether in the United States or in another country, they do not go away,\\" Abbott CEO Robert Ford says. \\"We need to think about how do we mitigate that, not just in the short term, but also long term.\\" pic.twitter.com/G6eyLlqb7v

— Yahoo Finance (@YahooFinance) August 27, 2025

In April, Abbott announced a $500 million investment to boost US manufacturing at two plants in Illinois and Texas. Those sites are expected to be \\"up and running by the end of the year,\\" according to Ford.

Read more from Yahoo Finance here.

Williams-Sonoma (WSM) said it saw minimal impacts from tariffs in its second quarter results but expects tariffs to pressure its top-line growth and operating margins in the current quarter.

\\"Our incremental tariff rate has doubled since our last earnings call,\\" CFO Jeffrey Howie said in the company's earnings call. \\"At our May earnings call, our incremental tariff rate was 14%. As of today's call, it has doubled to 28%. This includes the additional 30% China tariffs, 50% India tariff, 20% via non-tariff, and averaged 18% tariff on the rest of the world as well as the 50% steel and aluminum tariffs and a 50% copper tariff.\\"

The furniture company, which houses brands such as West Elm and Pottery Barn, reported better-than-expected earnings of $2.00 per share. Wall Street expected EPS of $1.80.

Williams-Sonoma stock was down 1.4% in early afternoon trading. The stock sank earlier this week, along with other furniture stocks, after President Trump posted on social media that his administration would open an investigation into furniture imports and impose additional tariffs on the sector.

\\"It's early to speculate — I think we're day 5 of a 50-day probe, there's not a lot of information on this subject,\\" Laura Alber, Williams-Sonoma's CEO, said about possible furniture tariffs. \\"But I will say that it's going to be very difficult for the industry, even if tariffs are put on to bring a huge amount back to the United States in a short window of time, because there aren't the factories available to do a lot of production.\\"

\\"For us, of course, we will be in a much better position than most if that were to happen because of our strong USA manufacturing capabilities already,\\" Alber continued. \\"We have ... [a] good chunk of our upholstery in the United States as we speak, and we can do more there, and that would be something we'd really push.\\"

In a portrait of US importers, Atlanta Fed economists wrote that most importers are small, and small importers are more exposed to tariffs and face steeper tariff increases.

According to their research, US firms tend to import products from one supplier and one country. Smaller importers import fewer products, and the products that they import are \\"on average less complex, more easily substitutable, and associated with shorter-lived supplier relationships.\\"

“Reliance on a single supplier means that small importers might have limited bargaining power to negotiate prices,\\" the economists wrote. \\"On the other hand, because small importers source less-complex products, they may be better able to find substitute products elsewhere.\\"

\\"Therefore, the ease with which small firms will be able to adapt to higher import tariffs and reroute supply chains depends on a combination of factors, including the extent to which they are affected by higher tariffs, the mix of products they import, and the countries from which they source their goods.”

The economists also noted that tariff-vulnerable importers tend to be located on the West Coast due to the proximity to shipping routes for China and Asia.

Yahoo Finance's Pras Subramanian reports:

Consumers are going to be paying a lot more for new cars, even if the White House strikes tariff deals with the biggest car importers, according to a report from Cars.com.

Currently, President Trump’s auto sector tariffs stand at 25% for most of the world and 27.5% for exports coming from the EU. Preliminary deals with the EU and Japan have the rate coming down to 15%, but there’s still much to be done to make the deals final.

But even if those rates come down, Americans will be paying significantly more for cars.

Cars.com said if tariffs remain at the 25% rate, analysts estimate the average new vehicle price could rise 13.5% to $54,400 from $48,000 — a difference of $6,400. But even if trade negotiations bring tariffs closer to 15%, prices may still increase by about 8.1%, or $4,300.

Read more here.

Bloomberg News reports:

Japan’s top trade negotiator Ryosei Akazawa will visit the US this week to press Washington to implement lower the tariffs agreed in July including lower duties on cars and auto parts.

His latest visit, starting Thursday, will be the 10th since the start of bilateral trade talks this year. Even though both sides struck a deal in July, the US has yet to deliver what it promised to do.

Japan wants the US to cut its tariffs on cars and car parts to 15% and to end the stacking of previous duties on 15% universal tariffs. Those demands require US President Donald Trump to issue an executive order on the car tariffs and amend his previous order on the across-the-board levies.

“The revision of reciprocal tariffs and the cut of auto tariffs are expected to take place simultaneously,” Akazawa said at a press conference in Tokyo on Wednesday evening.

“We urge them to be realized as soon as possible, even a day sooner, or even a moment sooner,” he said. Akazawa plans to return to Japan on Saturday.

Read more here.

The European Union will seek to fast-track legislation this week to remove all tariffs on US industrial goods, according to Bloomberg, citing people familiar with the matter. President Trump requested that tariffs be removed before the US lowers its duties on the bloc's auto exports.

The European Commission, which manages all trade-related matters, will impose preferential tariff rates on certain seafoods and agricultural goods.

Commission President Ursula von der Leyen described the trade arrangement struck between the US and the EU last month as a \\"strong, if not perfect deal.\\" However, others felt the deal favored the US more than it benefited the EU.

Bloomberg News reports:

The move comes even as Trump has threatened to impose tariffs and other penalties on countries that tax online services, without specifying which nations he would target and whether the EU would be involved. Trump has long railed against EU tech and antitrust regulation over US tech giants including Alphabet Inc.’s Google (GOOG) and Apple Inc. (AAPL).

EU cars and auto parts currently face a 27.5% tariff on exports to the US. Even though the US and EU struck a trade agreement that would see American tariffs on nearly all European products drop to 15%, Trump said that wouldn’t apply to cars until legislation was proposed to remove industrial and other duties.

If the EU proposes the legislation by the end of the month, then the 15% tariff rate on European cars will be back-dated to Aug. 1. Automobiles are one of the bloc’s most significant exports to the US, with Germany alone exporting $34.9 billion of new cars and parts to the US in 2024.

Read more here.

India has saved billions of dollars by purchasing discounted Russian oil in the wake of the Ukraine war. But tariffs imposed by President Trump on Wednesday could quickly undo some of these gains.

Russian crude oil now accounts for almost 40% of India's total oil purchases. Analysts say that stopping this could not only signal capitulation under pressure but also be economically damaging.

Global crude prices could triple to around $200 a barrel if India, the third largest consumer of Russian oil, were to stop buying.

Reuters reports:

According to a report in Bloomberg, analysts have estimated that India has saved at least $17 billion by increasing oil imports from Russia since early 2022. But with Trump's tariffs now in place this could slash exports by 40%, or $37 million by April-March 2026.

The tariff fallout is politically debilitating for Prime Minister Narendra Modi, as thousands of jobs are now at risk in labor-intensive sectors, such as textiles and jewellery.

Despite these tariffs Modi does want to repair the relationship between India and the US, and New Dehli's response over the coming weeks could reshape a decades-old partnership with Russia and recalibrate its complex relationship with the US.

\\"India needs Russia for defence equipment for several more years, cheap oil when available, geopolitical support in the continental space and political backing on sensitive matters,\\" said Happymon Jacob, the founder of Delhi's Council for Strategic and Defence Research. \\"That makes Russia an invaluable partner for India.\\"

Read more here.