US Tariffs in 2026: What Trade Volatility Means for Global Instrument Markets
The US Administration’s imposition of sweeping new tariffs on April 2nd of last year – ‘Liberation Day’ – (and on some subsequent occasions) was the source of great agita within boardrooms and government houses. Many countries responded in kind, though often these reciprocal tariffs were set at lower levels than the US tariff. Much of the latter half of 2025 was characterized by a bewildering period of tariffs being suspended, raised and lowered. Generally these moves were made in the furtherance of trade deals to try to settle the matter to everyone’s satisfaction, or to provide time to work out the details of such deals. Such activity slowed down towards the end of the year, and it seemed like the situation had stabilized.
This is not to say that the tariffs had no effect or that the effect had dissipated. Global companies, whether in the laboratory instrumentation space or not, made changes to their sourcing of materials and components, and even moved production sites to avoid tariffs. Some of this flexibility came from lessons learned in the pandemic, when sourcing some materials became difficult. Smaller companies were generally less able to adjust their operations, and had to live with the tariffs as best they could. For smaller companies that deal mainly within the US, or for others that have little footprint in the US, the tariffs may not have been a significant issue. But medium entities that have significant business across the US border faced the brunt of it. All in all, the tariffs have slowed global trade, reduced market growth, and distributed the pain slightly preferentially on US-based companies. But by the end of the year, the indications were that conditions were relatively stationary.
So much so that in the IBO 2026 Forecast Issue of January 15th, we opined that “at least a more static situation helps to alleviate some of the uncertainty facing the instrument industry. Most market participants have made what adjustments they can in terms of sourcing components, manufacturing and commercial operations in various regions. Likewise, customers have made similar adjustments and normalized.” While the tariff situation wasn’t good for business, we felt sanguine that it wasn’t going to get any worse. Two days after publication, Trump announced new tariffs on Denmark and other European nations tied to his ambition to possess Greenland.
Although this threat evaporated a few days later after the president declared a satisfactory “framework of a future deal” had been agreed upon, this set off a new stream of tariff announcements. These more recent tariff announcements appear to be created as a direct response to foreign governments that stand in the way of US interests. Beyond Greenland, the president has announced or threatened tariffs on South Korea for not ratifying a trade deal, on Canadian aircraft for slow approvals by Canadian officials of US-made planes, not to mention a 100% tariff on Canadian goods if it were to pursue a free trade pact with China. Although Canada recently lowered tariffs on Chinese EVs, the country’s leadership says it has no plans for a broader trade agreement with China. And most recently, Trump issued an Executive Order declaring an emergency with respect to the national security threat that Cuba poses to the United States. The active part of the EO is to impose additional tariffs on any countries that sell oil to Cuba.
The association with a declared emergency brings up another interesting point. The US Supreme Court has not yet ruled on the legality of the Trump tariffs declared using ‘emergency’ powers. Lower courts have found that the law does not give the president this power. The Supreme Court heard arguments last year, but no opinion has been reached, and no further opinions are expected until the court returns from a break on February 20th at the soonest. Some court watchers expect the opinion to have a complex web of concurrences and dissents, which may be causing some of the delay. Even if the tariffs are overturned, the president still would have some broad authority to impose tariffs on national security grounds, and only about half of the existing tariffs would be affected by the ruling.
So where does that leave us? Unfortunately, little wiser than before. Half of the tariffs may go away, or additional tariffs may be imposed as a new frequently used tool of foreign policy. One key thing does hold true, and it was predicted in our IBO 2025 Forecast Issue, shortly before the new administration came to power. If the US unilaterally declares a trade war against the other countries of the world, those countries are not obliged to make war on each other. On the contrary, they, facing a common adversary, have a great deal of incentive to lower trade barriers amongst themselves to improve their prospects in other regions if the US has become less attractive. And this has borne fruit with the EU forging new deals with South America and India, and numerous deals involving China and other Asian countries with their trading partners. While some of these deals have been decades in the making, they are very timely given the unilateral action of the US, and serve to point out that the US and US companies are likely to be the biggest losers in this altercation as the situation continues.
