Trump Plans New Tariff Policy! Why This Can Reduce Market Confidence

U.S. President Donald Trump announced a sweeping new tariff policy targeting foreign-made films. In a strongly worded statement posted on his social media platform, Trump declared a 100 percent tariff on all movies produced outside the United States.

It's a move that has rattled both the entertainment industry and global financial markets. The crypto sector, already sensitive to political developments, has responded with noticeable volatility as investor confidence weakens in the face of rising economic uncertainty.

Trump’s Tariff Policy and the Hollywood Shakeup

Trump’s statement on Truth Social was direct and emphatic. “We want movies made in America, again!” he wrote, adding that the U.S. film industry was in decline due to what he called a “concerted effort” by other countries to offer attractive film production incentives. 

He labeled the situation a "national security threat," claiming that foreign-made films are spreading "messaging and propaganda" that could undermine American interests.

This announcement follows a pattern of aggressive trade actions under Trump’s leadership. Previously, he has imposed tariffs of up to 245 percent on certain Chinese imports and 145 percent on foreign car parts. 

Now, his focus has shifted to the film industry, adding another layer of complexity to the already tense global trade environment.

Read also: Trump Says Crypto is Stronger than Most Assets! Is He Right?

Market Response: Crypto and Beyond

The ripple effect of Trump’s tariff announcement was immediate. Uncertainty spiked in both traditional and digital markets. 

Bitcoin, which had recently surged past $97,000, slipped below the $95,000 mark, landing at $94,134.95. Ethereum also fell to $1,804.98, and the total market capitalization of all cryptocurrencies dropped to $2.88 trillion.

This decline illustrates a recurring trend: when trade policies become unpredictable, markets tend to react negatively. Investors often see harsh tariffs as barriers to international commerce, potentially slowing economic growth. 

In the case of digital assets like Bitcoin, the heightened risk climate leads to profit-taking and reduced short-term confidence.

Read also: Is the US Becoming More Profitable? Analyzing Its Recent Tax Revenue After Tariffs

Final Thoughts

Trump’s new tariff policy targeting foreign-made films is more than just a political talking point. It introduces real uncertainty into the financial system at a time when stability is crucial. 

As the details of the policy remain vague, markets will likely continue to respond with caution. Whether or not this tariff is fully implemented, its impact on market confidence is already being felt, and its effects on the crypto landscape may linger for some time.

FAQ

What are tariffs and how do they work?

Tariffs are taxes placed on imported goods. They are usually charged as a percentage of the product's value. For example, a 10 percent tariff on a $10 item would add $1 to its cost, making the total $11. In cases like Trump's 145 percent tariff on some Chinese goods, a $10 item would cost $24.50 after the tax is applied. Importing companies must pay this tax to the government, and they often pass these added costs on to consumers.

Why is Trump using tariffs?

Trump argues that tariffs will make American-made goods more attractive to buyers, increase tax revenues, and encourage large-scale investment within the United States. He believes this approach can revive domestic industries and reduce reliance on foreign products.

How much trade is there between the US and China?

The United States runs a significant trade deficit with China. In 2024, the U.S. imported around $440 billion in goods from China, while exports to China totaled just $145 billion. This imbalance has been one of Trump's main justifications for aggressive tariff policies.