Brazil ETF Dips 0.6% as Supreme Court Ruling Cuts U.S. Tariff to 2.4%
After the Supreme Court struck down IEEPA tariffs, Trump imposed a 15% Section 122 global tariff, cutting Brazil’s effective U.S. duty by 10 percentage points to 2.4%. iShares MSCI Brazil ETF fell 0.6% on the ruling and is still up 24.6% year-to-date as lower duties may boost Brazilian exports.
1. Supreme Court Invalidates IEEPA Tariffs
The Supreme Court’s 6-3 decision struck down emergency and reciprocal tariffs imposed under the International Emergency Economic Powers Act, removing duties on key partners such as Canada, China and Mexico and reshaping the U.S. trade framework.
2. Trump’s Section 122 Tariff Imposed
Within hours, President Trump enacted a 15% global surcharge under Section 122 of the Trade Act of 1974, effective through July 24. This replaced invalidated IEEPA levies and resulted in country-specific changes, with Brazil’s effective rate falling by 10 points to 2.4%.
3. ETF Reaction and Outlook
The iShares MSCI Brazil ETF slipped 0.6% following the ruling but remains up 24.57% year-to-date. Investors are evaluating whether reduced U.S. duties will accelerate Brazilian export growth and support corporate earnings in the coming quarters.