President Trump's sizable tariffs are still on the table.

But markets seem very relaxed about this landmark change in global trade policy, and the

economic data seems to be hanging in.

So why is that?

And is there a risk that investors have become too complacent? I'm Alison Nathan, and this is

Goldman Sachs Exchanges. Today I'm joined by Jan Hotsias, head of Goldman Sachs Research in the firm's

chief economist and Dominic Wilson, senior advisor in the Global Markets Research Group. Jan, Dom,

it's great to have you back on exchanges

again. Thank you. Good forward to it. Jan, as I just said, the market seem very complacent

about tariff risk at this point, but a lot is still happening around them. So first, just catch us up

what's been implemented so far on the tariff front and what you expect to be implemented

ahead?

So far, we've seen about a 9 percentage point increase in the average effective tariff

rate on all U.S. imports, which is composed of 30% China tariffs, 25% Canada, Mexico, X.

USMCA, 10% on a broad range of countries, and then some sector-specific tariffs,

especially on autos and on steel and aluminum.

We're expecting that 9% point increase to go to something like 14 by the end of the year.

And we've been in that general vicinity for several months at this point.

It really hasn't changed very much, although the details keep changing and are probably going to continue to change.

Our current expectation is that the

5% point increment from here is going to be an increase in the sort of general baseline rate

from 10 to 15 and then we'll also get some additional sector-specific tariffs on things like semiconductors.

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