Published: Wed, November 28, 2018
Money | By Wilma Wheeler

Trump threatens a 25% tariff on the iPhone and Apple laptops

Trump threatens a 25% tariff on the iPhone and Apple laptops

Apple Inc.continued its downward slide Tuesday after U.S. President Donald Trump suggested that 10 percent tariffs could be placed on mobile phones, like the iPhone, and laptops made in China.

In an interview with The Wall Street Journal on Monday, Mr Trump repeated his threat to slap tariffs on all remaining imports from China, adding that "the only deal would be (that) China has to open up their country to competition from the US".

"Maybe. Maybe. Depends on what the rate is", Trump said of smartphones and laptop computers to the WSJ.

If negotiations were unsuccessful, Mr Trump said he would also move ahead with plans to target additional Chinese goods with tariffs.

Apple's stock fell 1.8% in after-hours trading on Trump's comments. Apple couldn't be reached for comment. If the iPhone were subject to a 10%-25% tariff, consumers would bear most of the extra cost.

Oil prices steadied, while the US dollar, which has benefited from safe-haven flows this year as the trade conflict worsened, rose against peers.

RBC analysts are also bullish on Apple, saying at least some of the negative news surrounding waning iPhone has already been priced into the stock - which is down more than 20% from its October peak.

Apple shares were up 1% this year. Inventec Corp., which supplies Apple and other US tech companies, fell 4 percent to the lowest level in more than a year. Ultimately, the US President advised companies willing to avoid tariffs should “build factories in the United States”.

Despite using contract manufacturers to make most of its products overseas, Apple has also sought to emphasize its contribution to the US economy, saying it plans to spend about $55 billion in 2018 with its USA -based suppliers.

Approximately half of all Chinese imports to the U.S. have been subject to a 10 percent tariff since September, but if upcoming trade negotiations between the U.S. and China don't work out, the tariffs could be expanded to all imported goods from China.

"They have to open up China to the United States".

Donald Trump has raised the stakes in the escalating global trade dispute between the US, China and some of America's traditional allies ahead of a major gathering of world leaders this week. "They haven't been. They have to treat us fairly", Trump told reporters at the White House.

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