Tesla Shares Decline Amid Concerns Over Trump's Tariff Plans

Tesla Inc. TSLA shares are trading lower Monday as investors react to rising macroeconomic uncertainty following U.S. President Donald Trump‘s confirmation of new tariffs.

What To Know: Trump announced plans to impose 25% tariffs on imports from Canada and Mexico and 20% tariffs on Chinese imports, set to take effect on Tuesday. The move raises concerns about increased costs for American consumers and the potential for higher inflation.

Economic data has already shown signs of weakness, with consumer spending declining in January and some GDP forecasts turning negative. Inflation remains above the Federal Reserve's 2% target, with the Consumer Price Index rising 3% in January, exceeding economist expectations.

While Treasury Secretary Scott Bessent downplayed the inflationary impact of the tariffs, suggesting that China would absorb the costs, market participants remain cautious. St. Louis Federal Reserve President Alberto Musalem indicated that near-term inflation expectations have "risen substantially" in recent weeks.

The Federal Reserve has held interest rates steady at a target range of 4.25% to 4.5% since January and the probability of maintaining this range at the next meeting remains at 93%, according to the CME Group’s FedWatch tool.

TSLA Price Action: Tesla shares were down 2.84% at $284.65 when the market closed Monday, according to Benzinga Pro.

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