Goldman Sachs: Even if the US Supreme Court rules Trump's tariffs illegal, the impact on the overall trade situation will be limited.
Goldman Sachs pointed out that in the oral debate section, several US Supreme Court justices questioned Trump's use of the International Emergency Economic Powers Act, indicating that the Supreme Court is increasingly likely to rule that the government's use of emergency powers to impose tariffs is unconstitutional. The market now predicts that the probability of the Supreme Court maintaining tariffs has decreased by about 10 percentage points. The final ruling is expected to be announced between December 2025 and January 2026. If the Supreme Court rejects the legality of tariffs, the government may need several months to refund the tariffs of about $115 billion to $145 billion that have been collected by then. However, the government is likely to seek other legal grounds to re-impose similar tariffs, meaning that the overall trade impact will remain limited. Any tariff reduction measures may only apply to smaller trading partners, and are not expected to have a significant impact on major economies such as the European Union. However, the handling of refunds and temporary tariff gaps may trigger short-term market volatility.
