A US federal court has blocked a set of tariffs imposed by President Donald Trump on imports from China, Mexico, and Canada, ruling that the measures are unlawful under existing trade laws.
A three-judge federal panel has ruled that Donald Trump overstepped his authority by using the International Emergency Economic Powers Act (IEEPA) to justify sweeping import tariffs.
The court stated that the 1977 law does not authorise a president to impose broad trade duties in the manner attempted.
The tariffs, introduced after Trump’s return to the White House in 2025, were presented as a response to drug trafficking and illegal immigration.
White House responds, critics celebrate
It is not for unelected judges to decide how to properly address a national emergency
said Kush Desai, White House deputy press secretary.
He repeated the administration’s commitment to ‘restoring American Greatness’ through executive action.
Critics of the tariffs, however, hailed the court’s decision. New York Attorney General Letitia James, representing one of 12 states that joined the lawsuit, said,
No president has the power to single-handedly raise taxes whenever they like.
She warned that the tariffs would have led to inflation, job losses, and economic damage.
Business groups and states back legal challenge
The lawsuit — the first major legal challenge to what Trump termed ‘Liberation Day’ tariffs — was filed by the Liberty Justice Center on behalf of five small import businesses.
It is one of seven legal challenges currently facing the Trump administration’s trade policies.
In its ruling, the court said the tariffs exceeded the president’s powers under IEEPA and failed to properly address the threats cited in the orders.
Markets react positively
Following the ruling, global financial markets rallied. Japan’s Nikkei 225 rose by 1.5%, and Australia’s ASX 200 also posted gains. US stock futures increased, indicating a potential market lift at the opening.
The US dollar strengthened against traditional safe-haven currencies such as the Japanese yen and Swiss franc.
