Trump’s Trade Strategy Faces Major Delays as Economic Warning Signs Emerge

With less than two weeks remaining in President Donald Trump’s 90-day pause on “Liberation Day” tariffs, the administration is running out of time to deliver the promised trade agreements aimed at reducing global trade uncertainty. So far, only two frameworks have been signed — far short of the 18 key trading partners the administration is targeting.

Trump has long claimed that hundreds of trade deals were either completed or nearly finalized. Yet, in recent weeks, both the White House and senior officials have admitted that dozens — let alone hundreds — of agreements are unlikely to be concluded by the looming July 9 deadline. Speaking on Friday, Trump reiterated his plan to set tariff rates unilaterally for countries that fail to finalize a deal with the U.S. in time.

“We can’t wait forever,” Trump said, indicating that countries will soon receive notice of the tariffs required to continue doing business with the U.S.

Commerce Secretary Howard Lutnick has promised a surge of trade announcements, suggesting “deal after deal” would be rolled out imminently. But progress has remained elusive. White House Press Secretary Karoline Leavitt and Treasury Secretary Scott Bessent both downplayed the importance of the July 9 deadline, suggesting instead that trade talks may extend into Labor Day.

Meanwhile, tensions escalated as Trump abruptly terminated trade talks with Canada over its digital services tax (DST), which he called a “blatant attack” on U.S. companies. A new tariff rate on Canadian goods is expected within the coming week.

Bessent added that up to 20 countries could revert back to the high “Liberation Day” tariff rates — some as steep as 50% — starting July 9. Others may be granted more time to negotiate.

“The expectation that global trade uncertainty would be resolved early this summer is clearly dead,” said economist Justin Wolfers. “Tariff aggression is still very much alive.”

Economic Risks Mount as Time Runs Out

The delays in trade agreements come at a critical time. Economic indicators show warning signs that the U.S. economy — while still strong — may be weakening.

Consumer sentiment rose 16% in June, according to the University of Michigan, thanks in part to record-high stock markets. But that optimism isn’t translating into spending. Consumer expenditures unexpectedly declined in May, the first drop since January, and inflation is beginning to pick up again.

Job growth has slowed, and retail sales have weakened — a troubling sign, considering consumer spending drives two-thirds of U.S. GDP.

“Consumers are nervous about the impact of tariff-driven price hikes,” said James Knightley, chief U.S. economist at ING. “And confidence in the job market is starting to falter.”

Many economists argue that the price stability seen in the spring was temporary. As inventories purchased before the tariffs run out, businesses are expected to pass on higher costs to consumers. Friday’s inflation report may signal that transition is already underway.

“We’re beginning to see the early effects of tariff-induced inflation,” said Robert Ruggirello of Brave Eagle Wealth Management.

Trump’s tax cuts may help soften some of the impact, but the risk of foreign retaliation remains high. Countries hit by new U.S. tariffs could respond with their own, targeting key American exports and potentially tipping the economy into a recession.

“The longer these deals stall, the greater the economic uncertainty,” said Michel Nies, an economist at Citi. “Trade friction could erode U.S. output and undermine fiscal health.”

With the clock ticking and few agreements finalized, the White House’s trade ambitions face growing doubts — and the fragile optimism in markets and among consumers could quickly vanish.