A federal court has blocked President Donald Trump from imposing tariffs under emergency powers, igniting backlash from the White House and sparking cheers on Wall Street.
The U.S. Court of International Trade ruled Wednesday that Trump exceeded his authority by attempting to impose tariffs under the 1977 International Emergency Economic Powers Act (IEEPA). The decision halts what Trump called his “Liberation Day” tariffs, aimed at reshaping global trade deals and bringing manufacturing jobs back to the United States.
In its opinion, the three-judge panel stated: “The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs.” The panel included judges appointed by Presidents Trump, Reagan, and Obama.
Trump had long argued that trade deficits pose a national emergency, giving him the right to act without waiting for congressional approval. His administration viewed tariffs as leverage to negotiate better trade terms for American workers and reduce the federal deficit.
White House officials blasted the ruling. Deputy Chief of Staff Stephen Miller wrote on X: “The judicial coup is out of control.” White House spokesperson Kush Desai added in a statement: “It is not for unelected judges to decide how to properly address a national emergency.”
The Trump administration has filed a notice of appeal with the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., and has 14 days to submit supporting documentation.
While legal teams prepare the next move, financial markets responded swiftly. The court’s decision lifted investor sentiment, with the S&P 500 E-mini futures jumping 1.5% and the Nasdaq futures climbing 1.9%. The U.S. dollar strengthened against the yen and Swiss franc.
Asian markets also rallied. Japan’s Nikkei rose 1.7%, South Korea’s Kospi gained 1.2%, and Taiwan’s Taiex added 0.5%. Nvidia’s earnings surprise added to the tech-driven momentum, with the chipmaker projecting robust revenue for the next quarter and its stock jumping 4.4% after hours.
The case marks a critical test of presidential power and trade strategy heading into the election season, as Trump doubles down on promises to put America’s workers first.