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US President Donald Trump has ruled out an exemption for Australian steel and aluminium under his wide-ranging tariffs.
This morning, White House press secretary Karoline Leavitt told Nine newspapers Trump had considered the possibility of an exemption before deciding against it.
"His tariff policies, what he envisions is reciprocity, fair trade practices, where American workers are put first and are no longer ripped off by foreign countries all over this world," Leavitt told reporters shortly before confirming his position to Nine.
READ MORE: Wall Street sell-off spirals after Trump tariff announcement
Australia recently recorded its first monthly trade surplus with the US, undermining a key argument for an exemption.
Trump spoke with Prime Minister Anthony Albanese about a month ago regarding a possible exemption from Australia.
Labelling Albanese "a very fine man", the US president promised to give "serious consideration" to a possible exemption.
READ MORE: Trump doubles planned tariffs on Canadian steel and aluminium to 50%
Australia did secure a tariff exemption after months of diplomacy in 2018, and Trump's style of government historically indicates he is open to reversing positions given sufficient incentive.
But heavy tariffs have been a significant feature of his second term, including on close trading partners Canada and Mexico.
And his key trade advisor Peter Navarro has been vocal in recent weeks on the subject, claiming Australia was waging a "frontal assault" on the aluminium market in the US.
The steel and aluminium tariffs come into effect this afternoon.
Trump's tariffs rattle Wall Street
After a brutal stock market selloff on Monday and further jitters Tuesday, Trump faces increased pressure to show he has a solid plan to grow the economy.
So far the president is doubling down on tariffs and can point to Tuesday's drama as evidence that taxes on imports are a valuable negotiating tool, even if they can generate turmoil in the stock market.
Trump has suggested tariffs were critical for changing the US economy, regardless of stock market gyrations.
The investment bank Goldman Sachs revised down its growth forecast for this year to 1.7 per cent from 2.2 per cent previously.
It modestly increased its recession probability to 20 per cent "because the White House has the option to pull back policy changes if downside risks begin to look more serious."
Trump has tried to assure the public that his tariffs would cause a bit of a "transition" to the economy, with the taxes prodding more companies to begin the years-long process of relocating factories to the United States to avoid the tariffs.
But he set off alarms in an interview broadcast on Sunday in which he didn't rule out a possible recession.
Trump has long relied on the stock market as an economic and political gauge to follow, only to look past it as he remains determined so far to impose tariffs. When he won the election last year, he proclaimed that he wanted his term to be considered to have started November 6, 2024 on Election Day, rather than his January 20, 2025 inauguration, so that he could be credited for post-election stock market gains.
Trump also repeatedly warned of an economic freefall if he lost the election.
"If I don't win you will have a 1929 style depression. Enjoy it," Trump said at an August rally in Pennsylvania.
-with Associated Press
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