The S&P Global Ratings affirmed the US's AA+ long-term credit rating with a stable outlook on Monday, saying tariff revenues will help offset the fiscal blow from President Trump's recent tax and spending bill.

The agency's view comes despite Trump's sweeping tariffs, which have rattled markets and strained trade ties.

Meanwhile, Brazil submitted its formal response to a US trade investigation, rejecting the allegations while challenging the legitimacy of the probe itself.

The investigation, launched in July under Section 301 of the 1974 Trade Act, will examine whether Brazil's digital trade and tariff policies unfairly harm US businesses, US Trade Representative Jamieson Greer said.

Brazil's finance minister Fernando Haddad said the country has hit an impasse with with the US over tariffs, adding that resolving the dispute will depend on Washington's willingness to engage.

White House trade advisor Peter Navarro warned India about "cozying up" to Russia and China through oil purchases in an op-ed published Monday in the Financial Times.

"If India wants to be treated as a strategic partner of the US, it needs to start acting like one," Navarro wrote.

President Trump announced additional 25% tariffs on Indian goods earlier this month, citing New Delhi's continued purchases of Russian oil.

The European Union, meanwhile, is seeking to stop the US from challenging its digital rules as both sides finalize a delayed statement on a trade deal reached last month.

US trade partners that believed they had worked out agreements with President Trump to avoid the harshest tariffs — such as the exemption for UK steel — are still waiting for their "deals" to be sealed as economic consequences compound over time.

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

The next negotiations to watch are Canada, Mexico, and China in the coming months.

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.

S&P Global Ratings on Monday affirmed the US's AA+ long-term rating with a stable outlook, saying tariff revenues will help offset costs from President Trump's recent tax and spending bill.

Bloomberg News reports:

The decision offers a glimmer of good news for Trump, who has pushed back against arguments that his historic program of tariffs will damage the US economy. Although the S&P analysts didn’t contradict that view, they stressed that as Trump embarks on a bold program of tax cuts and spending, tariffs will help soften the blow.

“Amid the rise in effective tariff rates, we expect meaningful tariff revenue to generally offset weaker fiscal outcomes that might otherwise be associated with the recent fiscal legislation, which contains both cuts and increases in tax and spending,” wrote analysts including Lisa Schineller in a note.

S&P’s views matter for investors in the world’s biggest bond market, which has been plagued by persistent questions over the fiscal deficit and debt sustainability. Yields on 30-year Treasuries jumped above 5% in May as tariff fears and Trump’s multi-trillion dollar tax bill roiled global markets.

Buy America

Whether tariffs will give the US a meaningful revenue boost is a subject of debate among economists, who point to an apparent contradiction at the heart of Trump’s approach: Tariff revenues rely on trade, but Trump has also attempted to pull production back to the US and encourage consumers to buy American-made products — moves that would undercut future levy receipts.

Read more here.

Brazil has rejected a US trade investigation launched in July under section 301 of the Trade Act of 1974, which seeks to determine whether its trade and tariff policies unfairly restrict American businesses.

In a formal response submitted Monday, Brazil dismissed the allegations and challenged the legitimacy of the probe.

Reuters reports:

While calling for \\"constructive dialogue,\\" the Brazilian government stated that it does not recognize Washington's authority to launch the unilateral investigation.

This action adds to growing friction between the two countries, including 50% tariffs imposed by the administration of U.S. President Donald Trump on imports of Brazilian goods and U.S. sanctions targeting a Brazilian Supreme Court justice.

In its 91-page response, Brazil refuted U.S. arguments concerning its trade practices, including its ethanol market and the popular digital payment system, Pix. The government argued Brazil's acts, policies and practices are not unreasonable, discriminatory or burdensome to U.S. commerce.

Read more here.

The Financial Times reports:

Brazil has reached an impasse with the US over the record tariffs it has imposed on the South American nation, its finance minister Fernando Haddad has said, insisting a solution depends more on Washington’s willingness to resolve the issue.

The US imposed 50 per cent tariffs on most Brazilian exports after President Donald Trump accused the country of conducting a “witch-hunt” against his ally, far-right former president Jair Bolsonaro, and demanded his supreme court trial be halted.

“The US is trying to impose on Brazil a solution which is constitutionally impossible,” Haddad said in an interview at an FT Live-Times Brasil/CNBC conference in São Paulo. “An impasse has been reached, it’s a request which cannot be fulfilled.”

Read more here.

Nissan’s (NSANY) Infiniti brand just unveiled its latest creation, the QX65 midsize crossover SUV, at Monterey Car Week.

The launch is part of a product renaissance at the Japanese automaker, which has been plagued with other headaches, such as tariffs.

Yahoo Finance's Pras Subramanian reports from Carmel, Calif., that the QX65 will be built in the US, which Infiniti’s US head, Tiago Castro, said was “very important” to increase its US footprint.

While Japan has a preliminary deal in place for 15% tariffs, cars imported from Canada and Mexico still have a 25% auto sector tariff tacked on. Signing a tariff deal with Japan is immensely helpful, as the QX80 SUV that’s in demand is built in Japan.

“The customers are reacting very well, and we need to deliver the vehicle” and not stop, Castro said.

Read more here.

Germany said on Monday the US must first implement the agreed lower tariffs on European-made cars before a broader trade deal can be finalized.

Reuters reports:

\\"In particular, car tariffs must be reduced quickly as agreed. We are also aware of the considerable burden on the export-orientated economy. ... Our role here is to continue to fully support the European Commission in this process,\\" a German government spokesman said in a press conference.

Read more here.

The holiday season is fast approaching and US shoppers will now face fewer choices for fake Christmas trees and decorations. The price of these items has also gone up due to tariffs on Chinese imports as retailers scale back orders.

Reuters reports:

A 90-day extension to a tariff reprieve - agreed to by Washington and Beijing on August 11 - will allow retailers to rush in some last-minute shipments, but most holiday purchases are already done. Retailers typically import seasonal goods in advance because many products need six-month lead times.

\\"We're going to have a lower supply year,\\" said Chris Butler, CEO of National Tree Company, a New Jersey-based artificial tree importer supplying Walmart, Home Depot, Lowe's and Amazon.

The company, which sources roughly half its trees from China and the rest from Vietnam, Cambodia, and Thailand, will hike prices by 10% to 20% on its Carolina pine, Nordic spruce, and Dunhill fir trees, Butler said.

Read more here.

Bloomberg News reports:

China’s exports of rare earth products — including magnets — extended their recovery in July, months after Beijing threatened a disruptive global shortage by crimping supplies to fight a trade clash with US President Donald Trump.

Shipments jumped last month to reach their highest since January, well before China leveraged its dominance of rare earths to hit back at Trump’s punitive tariffs. Beijing agreed to resume flows to the US as part of a trade truce with Washington.

Data released Monday covers rare earth products, a category typically dominated by so-called permanent magnets. Volumes sold overseas rose 69% to 6,422 tons in July, according to Bloomberg News calculations.

Read more here.

The EU is pushing back against US efforts to challenge its digital rules as both sides work to finalize a delayed trade statement, the FT reported.

Disputes over \\"non-tariff barriers,\\" which Washington says include the EU's Digital Services Act, have stalled the announcement. The statement was expected soon after European Commission president Ursula von der Leyen and President Trump unveiled a tariff deal in Scotland on July 27.

EU officials said the US wants room for concession on the act, but Brussels has called the rules a red line.

The FT reports:

But a US official said: “We continue to address digital trade barriers in conversations with our trading partners and the EU agreed to address these barriers when our initial agreement was struck.”

The commission had also expected Trump to sign an executive order lowering tariffs on EU cars exported to the US from 27.5 per cent to 15 per cent by August 15, but a US official indicated that this would not happen until the joint statement was agreed.

“Actions that adjust any tariff rate, such as Section 232 tariffs [which apply to cars] will follow the finalisation of joint statements with trading partners that we have reached agreements with,” the US official said.

Read more here.

Reuters reports:

White House trade adviser Peter Navarro said India's purchases of Russian crude were funding Moscow's war in Ukraine and had to stop.

New Delhi was \\"now cozying up to both Russia and China,\\" Navarro wrote in an opinion piece published in the Financial Times on Monday.

\\"If India wants to be treated as a strategic partner of the U.S., it needs to start acting like one.\\"

India's Foreign Ministry has previously said the country is being unfairly singled out for buying Russian oil while the United States and European Union continue to purchase goods from Russia.

U.S. President Donald Trump announced an additional 25% tariff on Indian goods earlier this month, citing New Delhi's continued purchases of Russian oil. The move will take total tariffs on imports from India to 50%.

\\"India acts as a global clearinghouse for Russian oil, converting embargoed crude into high-value exports while giving Moscow the dollars it needs,\\" Navarro wrote.

Read more here.

US trade partners that worked out exemptions to President Trump's tariffs — like the UK's deal to reduce tariffs on its steel to zero — are still waiting for the agreements to be finalized months later, Bloomberg reports, and are growing frustrated.

“Concern is growing that finalizing the deal on steel has fallen down the priority list both for the UK and US governments,” [UK steel lobbyist Peter] Brennan said last week. “The will to close the deal may well be faltering on both sides.”

Frustration and economic losses like those in the UK are growing in Japan, the European Union and South Korea. Those three made similar announcements over the past month: that Washington granted them leniency on auto exports in the haggling over the level of Trump’s across-the-board tariffs that took effect Aug. 7.

But for the trio of car export powerhouses, which unlike the UK face a 50% duty on their steel and aluminum, the wait for Trump’s concession continues while an American levy justified on national security grounds on imported Toyotas, BMWs, Hyundais and others remains at a crippling 25%.

“We’re continuing to see damage — the bleeding hasn’t stopped,” Japan’s chief trade negotiator Ryosei Akazawa said Friday in a reference to the country’s car industry. “We want the US to sign the executive order as soon as possible.”

Read more here.

(Bloomberg) — Republican Representative Zach Nunn is making an Iowa State Fair video about President Donald Trump’s tax law, shot on a John Deere tractor under the blazing August sun.

In it, Nunn, one of the nation’s most vulnerable incumbents, talks to constituent Sarah Curry about how the expanded child tax credit will help with the cost of one child’s speech therapy. Nunn is also planning to use the state fair as the backdrop for more videos selling the bill’s provisions temporarily cutting taxes on tips and overtime.

Economic issues — namely, Trump’s tax package and his tariff war with countries that buy much of Iowa’s agricultural products — will be front and center in Nunn’s race, and he’s eager to get a jumpstart defining the issues. So, too, are Democrats, who see Iowa’s two swing districts as must-wins in their push to take back the House majority.

Democrat Jennifer Konfrst, who is working to unseat Nunn, said she approaches Iowans at the fair asking them what keeps them up at night and the answer is usually “costs.”

Read more here.

Several major retailers will report earnings this week, which may give a first glimpse into how President Trump's tariffs have affected their bottom lines. The list includes Walmart (WMT), Target (TGT), Home Depot (HD), Lowe's Companies (LOW) TJ Maxx parent TJX Companies (TJX) and Ross Stores (ROST).

The Trump administration has urged retailers not to raise prices for consumers to offset the tariffs' impact, with a particular focus on Walmart, The Street reminds us:

The big issue for Walmart will be how CEO Doug McMillion discusses the Administration's tariffs after the retail giant announces earnings before Thursday's open,.

At Walmart's first-quarter earnings call in May, McMillon warned that \\"higher tariffs will result in higher prices.\\" He couldn't be more specific. Except to say that tariffs should not affect prices of goods the company buys from domestic vendors.

President Trump wrote on Truth Social a few days later, \\"Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain.\\"

The question will come up on Walmart's call as well as all the earnings call this week.

Read more here.

Economist Justin Begley of Moody's Analytics tells USA Today that President Trump’s economic policies won't cause a recession or stagflation, but will likely slow growth and push up inflation. The economy isn't in stagflation yet, Begley said, \\"but it's edging that way,\\" he adds:

Consumer price increases generally have eased substantially after a pandemic-related spike but recently edged higher, in part because of Trump's sweeping import levies.

His policies are imposing countervailing forces on the economy. Tax cuts and increased spending on border security and defense are set to juice growth. But those positive catalysts are expected to be more than offset by the tariffs, a historic immigration crackdown, layoffs of hundreds of thousands of federal workers and big cuts to social services programs such as Medicaid and food stamps, Begley said.

During Trump’s presidential race against former Vice President Kamala Harris last year, Moody’s, among other research firms, predicted Trump’s economic blueprint would spark a recession by mid-2025. Moody’s has updated its forecast in part because the contours of his plan recently have become more clearly defined, Begley said.

“We have a better view where things are going,” he said.

Read more here.

(Reuters) -The Trump administration widened the reach of its 50% tariffs on steel and aluminum imports by adding hundreds of derivative products to the list of goods subject to the levies.

In a Federal Register notice late on Friday, the Commerce Department said the Bureau of Industry and Security was adding 407 product codes to the Harmonized Tariff Schedule of the United States that identify the goods to be hit with the additional duties on the steel and aluminum content of those products.

The non-steel and non-aluminum content will be subject to the tariff rates President Donald Trump has imposed on the goods originating from specific countries, the notice said.

The levies on the goods on the expanded list go into effect on August 18.

Read more here.

Inflation expectations rose from July to August, indicating that consumers remain uncertain about President Trump's trade policies.

Year-ahead inflation expectations increased to 4.9% from 4.5% last month, according to the University of Michigan's survey of consumers. Long-run inflation expectations also rose to 3.9% in August from 3.4% in July.

\\"Overall, consumers are no longer bracing for the worst-case scenario for the economy feared in April when reciprocal tariffs were announced and then paused,\\" Joanne Hsu, the university's Surveys of Consumers director, wrote. \\"However, consumers continue to expect both inflation and unemployment to deteriorate in the future.\\"

Consumer sentiment also deteriorated month over month, falling for the first time in four months. The University of Michigan's Consumer Sentiment Index fell to 58.6 from 61.7 a month ago.

Read more here.

US import prices rebounded in July in the latest sign that inflation is set to pick up because of tariffs.

Reuters reports:

Import prices increased 0.4% last month after a downwardly revised 0.1% dip in June, the Labor Department's Bureau of Labor Statistics said on Friday. Economists polled by Reuters had forecast import prices, which exclude tariffs, unchanged after a previously reported 0.1% gain in June.

Though import prices do not include tariffs, the elevated readings suggested exporting nations are not cutting prices to offset the impact of higher costs from duties on consumers.

In the 12 months through July, import prices slipped 0.2% after falling 0.5% in June.

Imported fuel prices increased 2.7% in July after rising 0.8% in June. Food prices decreased 0.1% after dropping 1.3% in the prior month. Excluding fuels and food, import prices advanced 0.3%. Core import prices eased 0.1% in June. In the 12 months through July, they increased 0.8%.

Read more here.

President Trump said Friday he is planning on unveiling tariffs on semiconductor imports over the next two weeks, hinting that those duties could reach as high as 300%.

From Bloomberg:

The president has repeatedly promised that levies on chips and pharmaceuticals are coming within weeks, but no formal announcements have yet been made.

Both sectors have been under Commerce Department investigation since April, a prerequisite for Trump to impose tariffs on national security grounds. That process can prove complicated and probes can take months or longer to resolve.

Last week, Trump said during an event with Apple Inc. Chief Executive Officer Tim Cook that he planned a 100% tariff on semiconductors, while exempting products from companies that are moving manufacturing to the US.

The White House hasn’t offered a subsequent explanation for how that exemption would work, but Trump implied that Apple — which has pledged a $600 billion domestic manufacturing initiative — could be exempt.

On Friday, Trump suggested the charge on imported semiconductors could be even higher.

“I’m going to have a rate that is going to be 200%, 300%?” Trump said.

Read more here.

Shares in Applied Materials (AMAT) sank 14% before the bell on Friday after the chip equipment maker issued weak fourth-quarter forecasts on sluggish China demand, fueling concerns over tariff-related risks.

Reuters reports:

The Santa-Clara, California-based company's forecast comes after similar tariff warnings from ASML Holding, the world's biggest supplier of chip-making equipment, last month.

CEO Gary Dickerson flagged lower visibility and increased uncertainty in the near-term, citing \\"wide-ranging implications for the semiconductor industry\\" from the dynamic policy environment, during a post-earnings investor call.

China, Applied Materials' top revenue source in the July quarter, accounting for 35% of sales, has emerged as a growing risk as U.S. export restrictions weigh on new orders for chipmaking tool suppliers.

\\"China volatility is significantly clouding visibility into core earnings potential both geopolitically and cyclically,\\" Deutsche Bank strategists said in a note.

Read more here.

China's economy lagged in July as factory output and retails sales slowed and house prices dropped, according to data released on Friday. President Trump's tariffs have added to uncertainty on exports and are looming over the world's second-largest economy. Concerns linger despite Trump extending a pause in sharp hikes in import duties for 90 days, beginning Monday, following a 90-day pause that began in May.

AP reports:

As officials worked toward a broader trade agreement, China reported earlier that its exports surged 7.2% in July year-on-year, while its imports grew at the fastest pace in a year, as businesses rushed to take advantage of the truce in Trump's trade war with Beijing.

But that also reflected a lower base for comparison, and manufacturers have slowed investments, hiring and production as they watch to see what comes. Chinese manufacturers also have ramped up shipments to Southeast Asia, Africa and other regions to help offset lost business in the U.S.

“Exports remained a bright spot although the boost from front-loading appears to be tapering off and has started to show up in weak industrial production, as we anticipated,” Oxford Economics’ Sheana Yue wrote in a report.

Read more here.

Bloomberg News reports:

Taiwan raised its estimate for growth in 2025, easing some concern over the impact of US duties on an economy that has roared on tech exports.

Gross domestic product is set to expand 4.45% this year, the statistics bureau in Taipei said in a statement on Friday – its first estimate since the Trump administration hit the archipelago’s shipments with 20% tariffs. The new figure is up from the 3.1% predicted in May.

In a sign the government is confident demand for Taiwan’s products will persist, the bureau predicted exports will rise 24.04% this year, up from the previous call of 8.99%.

Read more here.