Source: Fortune
Summary
The Trump administration has returned over $100 billion in tariffs to US businesses and importers, which is boosting corporate earnings and GDP growth. According to Apollo Chief Economist Torsten Slok, the refunds will contribute about 0.2 percentage point to third-quarter GDP growth, which is tracking toward 4.3%. The refunds are also combining with other positive factors, such as the AI spending boom and tax cuts, to support the US economy.
Our Reading
The numbers tell one story.
Tariff refunds are boosting corporate earnings, with Apple alone reporting nearly $2.2 billion. Other top recipients include Nike, FedEx, Amazon, and General Motors. The refunds are also contributing to GDP growth, which is expected to accelerate to 4.3% in the third quarter. The economy is supported by a growing set of tailwinds, including the AI spending boom and tax cuts.
The surprisingly weak jobs report for July doesn’t signal the economy is losing momentum, according to Slok. Jobless claims have hovered around 200,000 a week, and the number of job openings has been rising over the past six months.
In short, the market is underestimating how strong growth is right now.
The refunds represent about 60% of the $166 billion in revenues collected from import taxes under the International Emergency Economic Powers Act, which were struck down by the Supreme Court in February.
Author: Evan Null
