Likelihood of Donald Trump Imposing Large Tariffs in 2025 and Potential Countries for Retaliation

• Prediction markets now give 83% odds that Trump will implement large tariffs in his first year
• China tariffs already in effect as of February 2025, with more countries targeted soon
• Read below for the latest odds, implementation timeline, and which counties will retaliate

Will President Trump deliver on his campaign promise to implement sweeping tariffs during his first year back in office? According to prediction markets, it’s not just likely – it’s already happening. The latest odds from Kalshi give an 83% chance that the U.S. average weighted tariff will reach at least 6% by Q4 2025, a major shift in American trade policy.

This market has seen big movement recently, with odds climbing after what traders call “Liberation Day” announcements. With over $518,000 bet on the outcome, traders are putting real money behind their predictions.

Trump First-Year Tariff Implementation Odds

Odds as of April 3rd, 2025 at Kalshi prediction markets. Sign up with the Kalshi promo code to start trading. Total trading volume: $518,423.

Tariff Implementation Already Underway

The question isn’t whether tariffs are coming – they’re already here. According to multiple reports, Trump’s 10% tariff on Chinese products went into effect on February 4, 2025. The White House has released a fact sheet confirming tariffs on imports from China, with temporary exemptions for Canada and most goods from Mexico.

These new tariffs follow Trump’s call for “reciprocal” trade policies—basically matching what other countries charge on U.S. exports. Here’s what’s in place so far:

• 25% tariffs on steel, aluminum, and possibly copper
• 10% blanket tariff on goods from China, partly linked to fentanyl concerns

This implementation timeline is reflected in Kalshi’s highest-volume market on tariff timing:

When Will New Tariffs Come Into Effect?

Market resolves to “Yes” if any new/raised tariffs are implemented before May 1, 2025.

If any new or increased tariffs are in place before May 1, 2025, this market resolves to “Yes”—and it basically already has. According to The New York Times, the Chinese tariff took effect at 12:01 a.m. on February 4.

White House documents back this up, and earlier “Before March 2025” markets have already paid out.

Which Countries Will Retaliate?

As the U.S. rolls out tariffs, another high-volume market ($149,176) is betting on which countries will impose their own tariffs on the US before July 1, 2025. Canada and China have already implemented retaliatory measures, while others are expected to follow suit soon.

Countries Expected to Impose Retaliatory Tariffs

Odds for countries imposing tariffs on the US before July 1, 2025. Canada and China have already implemented retaliatory tariffs.

The EU shows the highest probability (96%) among countries yet to retaliate, with traders citing Reuters reports that the EU will impose counter-tariffs on over $28 billion of US goods starting April 1st. South Korea and South Africa have also seen significant increases in their odds, rising 24 and 16 points, respectively.

Interestingly, Mexico’s odds dropped sharply (down 29 points to 45%), as markets seem to believe the country may have secured exemptions or concessions from the Trump administration. Meanwhile, India is creeping up due to potential friction among BRICS nations.

Related markets show expected scope of tariff implementation beyond China.

Traders see a high chance (94¢) that EU tariffs, if imposed, will fall in the 20–29.99% range. That’s hefty. But they’re less confident about the timing—just a 27% chance Trump hits the EU auto sector within his first 100 days.

Will Tariffs Really Hit 6%?

Even with the high 83% “Yes” probability that the weighted average tariff will hit 6%, there’s still some doubt about how it plays out in practice. A few reasons why:

• Exemptions could dilute the overall tariff average
• Some of the early rhetoric seems to be softening
• Past rollouts haven’t always matched the big talk

I see the 18% “No” position as potentially undervalued if the administration grants substantial exemptions to major trading partners. The 6% weighted average is a significant jump from current levels and would require consistent application across major import categories.

One key point here: Kalshi’s using official FRED (Federal Reserve Economic Data) figures to settle this market. So we’ll have a clear benchmark for what counts and what doesn’t.

Verdict on Trump Tariff Predictions

Prediction markets aren’t just forecasting tariffs – they’re watching them unfold in real time with China. When 83% of traders are betting on tariffs hitting 6% by late 2025, they’re essentially telling us this is just the opening act of a much bigger trade policy transformation.

The message for businesses and investors couldn’t be more straightforward: brace yourselves. Import costs are headed up, with Chinese goods, metals, and potentially European products in the crosshairs. And don’t expect other countries to sit idle – the EU is virtually guaranteed to hit back according to these markets, with several major U.S. trading partners likely to roll out their own tariffs before mid-2025.

As we look ahead to 2025, one of the key questions on the minds of many economists and trade experts is the likelihood of President Donald Trump imposing large tariffs on other countries. Throughout his presidency, Trump has been known for his protectionist trade policies, including imposing tariffs on goods from countries like China and Mexico.

There are several factors that could influence the likelihood of Trump imposing large tariffs in 2025. One key factor is the state of the global economy. If the global economy is experiencing a downturn or if there are trade tensions between major trading partners, Trump may be more inclined to impose tariffs as a way to protect American industries and jobs.

Another factor to consider is Trump’s political motivations. If Trump is facing reelection in 2024 or if he is looking to boost his popularity with his base, he may be more likely to impose tariffs as a way to show that he is tough on trade and protecting American interests.

In terms of potential countries for retaliation, it is difficult to predict which countries Trump may target in 2025. However, some potential candidates could include countries that have large trade surpluses with the United States, such as China, Germany, and Japan. These countries have been targets of Trump’s trade policies in the past and could be at risk for further tariffs in the future.

It is also worth noting that Trump’s trade policies have been met with mixed reactions from both domestic and international stakeholders. While some argue that tariffs are necessary to protect American industries and jobs, others argue that they can lead to higher prices for consumers and hurt American businesses that rely on imports.

Overall, the likelihood of Trump imposing large tariffs in 2025 will depend on a variety of economic, political, and social factors. It will be important for businesses and policymakers to closely monitor developments in trade policy to anticipate any potential changes that could impact their operations.