President Donald Trump has raised the stakes of his self-styled reciprocal trade war by mailing Brazil a letter imposing a 50% tariff on all goods entering the US after 1 August.
“This Trial should not be taking place. It is a Witch Hunt that should end IMMEDIATELY!” the letter declares, linking the duty to Brazil’s prosecution of former president Jair Bolsonaro rather than any measurable trade imbalance.
The tariff will hit a large trading partner as US enjoyed a $7.4 billion goods surplus with the country, exporting $44 billion while buying only $42 billion in return. Even so, the 50% rate is five times higher than the baseline 10% duty Trump announced in April and by far the steepest tariff assessed on a top-twenty trading partner since 1934.
Brazilian President Luiz Inácio Lula da Silva blasted the 50% tariff as an intolerable act of foreign state, immediately summoning Finance Minister Fernando Haddad, Foreign Minister Mauro Vieira and Vice President Geraldo Alckmin for crisis talks at the Palácio do Planalto, while warning that Brasília will hit back under its economic reciprocity law if Washington enforces the duty on August 1.
The Brazilian real plunged almost 3% on the news, while the iShares MSCI Brazil ETF shed nearly 2% in after-hours trading.
The letter dismisses years of negotiations as “unfair” and offers zero tariff only if Brazilian firms shift production to US soil—an echo of similar demands sent this week to Japan, South Korea, and more than a dozen smaller economies. Treasury Secretary Scott Bessent says “about 100” countries never replied to Washington during the 90-day pause that ends today; they will all face at least 25% duties on August 1.
Smaller economies were not spared. New letters set 30% tariffs on Algeria, Libya, Iraq, and Sri Lanka; 25% on Brunei and Moldova; and 20% on the Philippines, which sold $14 billion in goods to the US last year.
Trump threatened still steeper penalties, telling reporters some letters “are at 60%, 70%—maybe higher.”
The EU could be next with Trump saying he is “probably two days off” from mailing Brussels its rate, even as EU trade chief Maroš Šefčovič claimed a framework deal is “potentially” within reach. Investors remain skeptical: Yale Budget Lab calculates that enacted notices already lift the effective US tariff rate to 17.6%, the highest since the Smoot-Hawley era.
Trump also invoked national security to unveil a separate 50% duty on all copper imports, citing a Section 232 investigation initiated in February. The announcement propelled Comex copper futures to record intraday highs as manufacturers scrambled to book metal from Chile and Mexico before the levy takes effect.
The White House framed the move as essential for “a DOMINANT Copper Industry,” yet analysts warn that the duty will raise costs for US electric-vehicle, semiconductor, and defense supply chains rather than revive dormant smelters.
Trump insists the levies will generate “well over $300 billion” in customs revenue this year—money the Treasury counts on to offset an extension of his 2017 tax cuts. Yet the administration’s own tally shows only two partial agreements so far: one with the UK, another with Vietnam. Deputy Treasury Secretary Michael Faulkender conceded that most pacts will remain loose “frameworks” even if signed before the deadline, with details worked out well beyond August 1.
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