Supreme court strikes down Trump's tariffs

In its simplest form, a tariff is a tax on goods coming into the country from outside sources. The idea behind tariffs is that they make foreign products more expensive, so consumers opt to buy American products instead. Trump's administration had put in place these tariffs under "emergency powers" on a very wide range of imports.

On Friday, the Supreme Court ruled that the president did not have the right to do so, and therefore declared the tariffs as unconstitutional and illegal. This is a very big blow to the Trump administration and their economic policies.

This matters because tariffs affect the price of everyday items. When tariffs go up, imports become more expensive, and that cost usually gets passed down to regular consumers. The recent court ruling has created uncertainty for price movements in such products.

The U.S market opened with losses this morning as a result of the Supreme Court's ruling.

To make things more complicated, the U.S economy is showing warnings. Growth slowed to 1.4% at the end of last year, and inflation is sitting at 3%. Such a combination of slow growth and rising prices is what many economists call stagflation, and it is certainly not a fun place to be.

The administration is expected to look for other ways in which they can keep their tariffs in place, so this story has not yet been closed. Stay tuned!