A U.S. federal trade court has blocked most of President Trump's sweeping tariffs.

But the Trump administration is appealing the decision.

So how significant will this ruling prove to be?

And what impact will it ultimately have on Trump's trade policies?

I'm Alison Nathan, and this is Goldman Sachs Exchanges.

For today's episode, I'm speaking with my colleague, Alec Phillips, Chief U.S. political economist in Goldman Sachs research.

Alec, welcome back to the program.

Thanks.

Thanks for making yourself available on such short notice.

Sure.

Another big development, it seems, as we sit here on Thursday, just to recap last night, there was a court know, seemed to upend much of Trump's proposed tariff policies.

So first, Alec, set the stage for us.

Explain in broad strokes what the court said and why it's important.

Right. So what the court said, and to be clear, this was a three-judge panel on the Court of International Trade, which is like a district court, so it's the lower-level court.

What the panel said was that these tariffs are essentially so large and unlimited that it's hard to reconcile that with the idea that the administration has authority to impose tariffs like that, given what's called the non-delegation doctrine.

Essentially the idea that Congress has the power to impose tariffs, they can delegate certain powers to the administration, but only with intelligible limits.

And since there was no limit, seemingly, on the administration's power in this case, the tariffs are just so large that it's hard to reconcile those two things.

There was a separate piece of the ruling which spoke

specifically to what they deemed the trafficking tariffs, but this was essentially the tariffs from

February and March related to Canada, China, Mexico on immigration and on fentanyl, where they essentially said that a different section

of the law requires that the tariffs deal with, quote unquote, the issue at hand, and that

it wasn't clear that the tariffs that the administration put on those countries dealt with

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