President-elect Trump’s emphatic promise of new tariffs is sharpening the debate over how he will handle the economy. It’s likely the single most important domestic issue of his second term.

Trump is poised to enjoy almost perfect timing in taking the reins of an economy on the rise.

Inflation has tapered all the way down to 2.6 percent in the latest figures. Price rises had peaked at 9.1 percent in June 2022, 17 months after President Biden took office. The political wounds inflicted at that time contributed to Vice President Harris’s defeat by Trump in November’s election.

The unemployment rate is a modest 4.1 percent. And, in September, the Federal Reserve cut interest rates for the first time in four years. It did so again at the start of this month — with the expectation of more cuts to come.

Trump “is inheriting an exceptional economy,” said Mark Zandi, chief economist at Moody’s Analytics. “It is growing strongly, there are lots of jobs across lots of industries, and unemployment is low. The only blemish had been inflation, but that’s now down as well.”

But many economists, including Zandi, wonder if Trump’s enthusiasm for tariffs could trip him up.

Earlier this week, Trump announced plans to levy tariffs of 25 percent on all imports from Canada and Mexico, as well as adding 10 percent to existing tariffs on Chinese imports.

Writing on social media, the president-elect contended that the tariffs on Mexico and Canada were related to immigration — or as he put it, “ridiculous........

© The Hill