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What Are Steel Tariffs and Why Do They Matter for Forex and Crypto Traders
Apr 20, 2025
Steel tariffs significantly impact the economy and the financial market at large. When the Trump administration announced the Section 232 tariffs on steel and aluminum imports in 2018, the announcement rattled global markets. They worried the tariffs would hurt global economic growth and stifle trade, leading to a recession. In March 2021, President Biden extended the tariffs, which will likely remain in place until at least 2025.
So it is vital to know the steel tariffs and how they affect the economy and different markets, especially if you trade forex or cryptocurrencies. This guide Trump tariffs 2025 will help you understand steel tariffs and why they matter for forex and crypto traders.
GoMoon's AI-powered economic calendar can help traders track steel tariffs and other relevant market-moving events.
Table of Content
What Are Steel Tariffs and Why Do Governments Use Them
Steel tariffs are taxes imposed by a government on imported steel products. For example, if the U.S. sets a 25% steel tariff, any steel coming into the country from abroad will be taxed an extra 25% of its value. This makes imported steel more expensive than steel produced domestically. Customs authorities collect these tariffs at the point of entry (ports). The purpose is to make foreign steel less competitive in price compared to locally made steel.
Why Do Countries Use Steel Tariffs?
Governments use steel tariffs for several economic and political reasons. Here are the most common:
Protecting domestic industries
Countries like the U.S. or Canada may impose tariffs to shield local steel producers from cheaper foreign competition (e.g., Chinese or Mexican steel).
Maintaining national security
Steel is essential for defense and infrastructure. A country that’s too dependent on foreign steel may feel vulnerable during conflict or global supply chain disruption.
Responding to dumping
Tariffs are a standard retaliatory tool if a country believes another country is "dumping" steel (selling it below production cost to flood the market).
Reducing trade deficits
Tariffs can reduce the number of imports and encourage buying local, which narrows the trade deficit.
Steel Tariffs Can Influence Forex and Crypto Markets
Steel tariffs don’t just affect steel companies -- they impact the entire economy, including:
Manufacturers who need steel for cars, appliances, tools, and infrastructure.
Consumers may face higher prices as companies pass on costs.
Traders who must navigate price changes, market volatility, and geopolitical risks.
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How Steel Tariffs Trigger Market Reactions in Forex and Crypto
Steel Tariffs Crank Up Inflation Expectations
Tariffs on imported steel directly increase the cost of domestic companies doing business. Industries like auto manufacturing, construction, and machinery rely on steel to produce their goods. When tariffs are imposed, these businesses often pay more for materials and pass that cost on to consumers. As a result, prices rise across the board on goods that rely on steel, contributing to inflation.
What does this mean for Forex?
Central banks like the Federal Reserve or the Bank of Canada may raise interest rates to stabilize the economy when inflation rises. Higher interest rates typically strengthen a country’s currency in the short term, but if inflation spirals, it can cause long-term weakness due to economic slowdown fears. Forex traders should closely monitor inflation signals and central bank statements after tariff changes.
Steel Tariffs Can Weaken Economic Output
When input costs rise (steel, aluminum), businesses may cut spending, reduce hiring, or slow production. This can lower GDP growth and shake investor confidence in that country’s economy.
What does this mean for Forex?
Currencies of countries hit hardest by tariff wars (like CAD or USD) may face selling pressure if investors expect the economy to slow. Haven currencies like the Japanese yen (JPY) or Swiss franc (CHF) often strengthen in response to this instability.
Crypto Reacts to Sentiment and Uncertainty
Cryptocurrencies like Bitcoin often react sharply to macroeconomic shocks. Investors may flee traditional markets and look to decentralized assets as hedges in a tariff war, especially between major economies (U.S. vs Canada/China). What this means for crypto traders is that Bitcoin and Ethereum may spike in demand as investors seek shelter from fiat currency fluctuations. However, if the broader economy is at risk, crypto could face liquidity shocks and sell-offs as people rush to cash.
Market Volatility Becomes a New Normal
Steel tariffs are usually not isolated; they’re part of broader trade wars that evolve over weeks or months. This uncertainty increases volatility in all markets: commodities, currencies, crypto, and equities.
How Traders Can Prepare
Use tighter risk management rules, top losses, alerts, and hedges. Monitor tariff announcements and economic calendars. Track intermarket signals: if steel prices spike, anticipate downstream reactions in CAD/USD, USD/CNH, and BTC.
What Is the Current Steel Tariff in 2025?
Steel and Aluminum Tariffs Are Rising Again
On April 14, 2025, President Trump officially raised tariffs on steel and aluminum imports by 25%, removing exemptions previously applied to select trade partners. This meant that all countries, including close allies like Canada, Mexico, and the EU, are now subject to these tariffs.
But this wasn’t just a bump in rates. It came after expanded tariff coverage to include derivative steel products, meaning finished goods like cables, transformers, conductors, and steel-based frames. Industrial and clean energy equipment is used in wind farms, solar farms, and power grids. This move dramatically widened the tariff net, impacting manufacturers across the energy, utilities, and infrastructure sectors.
The 90-Day Pause and the Global 10% Baseline Tariff
On April 9, 2025, just before this tariff expansion, Trump paused an additional planned tariff hike for 90 days. This pause applied to most countries, not China, Canada, or Mexico. Still, a baseline 10% tariff on all U.S. imports remains in effect for every country, layered on top of: Steel and aluminum-specific tariffs Country-specific penalties (especially for non-compliant or “high-risk” trade partners) So effectively, all imported goods are now more expensive, and for high-steel-content items, costs have soared significantly.
The U.S. Steel Import Snapshot
The U.S. imported 26.2 million tons of steel in 2024, a 2.5% increase over the previous year. According to the American Iron and Steel Institute, 23% of all steel consumed in the U.S. in 2024 was imported. That means almost 1 in every 4 tons of steel used in manufacturing, construction, or energy infrastructure is now subject to hefty tariffs. This dependency is what makes these tariffs so impactful and potentially inflationary.
What Experts Are Saying
Industry insiders warn that Tariffs will inflate domestic steel prices and Energy. Infrastructure projects will face longer lead times and budget overruns The burden on the supply chain could slow down America’s energy transition and undermine infrastructure renewal goals Vanessa Sciarra from the American Clean Power Association explained it this way: “Policy whiplash from these tariffs will ultimately undermine the ability to realize a domestic supply chain... and constrain efforts to deliver energy security and reliability for Americans.”
A $53 Billion Tariff Burden on the Horizon
According to PwC's US Tariff Industry Analysis, these latest steel and aluminum tariff changes could increase the cost burden from $400 million to $53 billion annually in the Energy, Utilities, and Resources sector alone. And that number doesn’t even include the universal 10% import tariff still in effect.
How Traders Should Strategize Around Steel Tariffs in 2025
Tariffs as Economic Signals: What Steel Tariffs Mean for Traders
Steel tariffs like Trump’s 25% hike signal a change in the broader economy. A sudden tariff like this tells traders the U.S. is entering a protectionist phase, often leading to currency devaluation and global trade slowdowns. Due to reduced exports and foreign retaliation, demand for U.S. dollars may weaken, while safe-haven currencies like the Swiss franc or Japanese yen tend to strengthen. Forex traders should watch these macro moves closely, as they are signals to shift currency pair positions or prepare for volatility spikes.
Track Industrial and Commodity Exposure: What to Watch as Steel Tariffs Hit the Economy
Steel tariffs directly hit construction, clean energy, manufacturing, and infrastructure sectors. A slowdown in these sectors means reduced industrial output, which could lead to lower GDP growth. Steel tariffs also increase production costs, which can result in higher inflation. GoMoon.ai users can set up watchlists to track U.S. Producer Price Index (PPI) reports, steel production, import/export volumes, and industrial stocks tied to energy, grid, or automotive sectors. This gives you a real-time window into how tariffs are rippling across the economy and helps you accurately time your trades.
Use GoMoon.ai’s AI Alerts for Macro Shifts: Get Ahead of the Curve on Steel Tariffs
Markets don’t move only when news breaks; they shift before, during, and after the policy shock. With GoMoon.ai, you can create AI-powered alerts that trigger when steel-related companies like U.S. Steel, Nucor, or ArcelorMittal experience unusual volume. You can also monitor social sentiment spikes around keywords like "tariffs," "aluminum prices," or "Trump's trade war," and automate economic calendar tracking for tariff policy updates, FOMC speeches, and manufacturing index releases. This keeps you ahead of the crowd, giving you the edge to enter or exit positions just before the trend becomes mainstream.
Position Crypto for the Volatility Window: Steel Tariffs Are Risk Triggers for the Crypto Market
Crypto traders should understand that tariffs are risk triggers. When steel tariffs rise, institutions shift capital away from risk assets like Bitcoin. Fear of inflation and slower economic growth make stablecoins and dollar-backed assets more attractive. However, after initial panic, crypto often rebounds as a hedge against government policy missteps. On GoMoon.ai, you can run simulations of how Bitcoin reacted to past economic shocks, such as the 2018 steel tariffs. To diversify intelligently, you can track whale wallet movements during tariff announcements and see correlated altcoin performance. This data-driven edge helps you ride the volatility instead of being crushed.
Hedge and Adapt With Confidence: Steel Tariffs Create Uncertainty for Traders
When trading in tariff-heavy environments, your job isn’t just to guess the direction to manage the uncertainty.
Here’s how GoMoon.ai helps you Stay Strategic
AI-generated hedge recommendations based on real-time volatility; Forex pair suggestions for risk-off trades like USD/CHF or JPY pairs; Altcoin insight reports showing which tokens are historically resilient during trade wars. By integrating these tools into your trading system, you shift from reactive to proactive, adapting quickly and trading confidently in complex global conditions.
Let’s Talk About GoMoon AI
GoMoon transforms economic calendar data with AI-powered insights for smarter trading decisions. Our platform analyzes global events and rates their market impact on a scale of 1-10, helping you understand how they'll affect various assets. We've packed everything traders need: Live economic event streaming, custom notifications, and historical event replay with TradingView charts. What sets us apart is our comprehensive approach to event analysis.
Whether you're tracking the impact of major economic announcements or comparing forecast data with actual outcomes, GoMoon provides clear, actionable insights. You can personalize your calendar, stream live meetings directly on the platform, and analyze historical events like the dot-com bubble or the COVID-19 crash to understand market reactions better. GoMoon clarifies the complex world of economic events for traders seeking data-driven decisions. Get started for free to get AI-powered economic insights today.
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Use Our AI-powered Economic Calendar Tool for Free Today
Steel tariffs are not a simple number or percentage. Their impacts trickle down to affect real people and businesses, creating winners and losers. For example, while the U.S. steel industry may benefit from tariffs, American manufacturers that rely on imported steel and aluminum to produce their goods will face higher costs, which could lead to layoffs, reduced production, and facility closures.
Understanding how these tariffs impact the broader economy and individual sectors can help businesses make informed decisions and adjust to a changing trade environment. GoMoon clarifies the complex world of economic events for traders seeking data-driven decisions. Get started for free to get AI-powered economic insights today.
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