MW Bessent warns some steep 'liberation day' tariffs may return, dismisses Moody's downgrade

By Mike Murphy

U.S. Treasury Secretary Scott Bessent warned Sunday that some of America's trading partners could soon face another sharp hike in tariff rates, and dismissed Moody's downgrade of the U.S. government's credit rating.

In an interview Sunday morning with NBC News' "Meet the Press," Bessent said President Donald Trump's so-called "liberation day" tariffs - most of which were suspended for 90 days - may be reimposed if countries do not negotiate "in good faith" before the pause expires in early July.

"They are going to get a letter saying, 'Here - here is the rate.' So I would expect that everyone would come and negotiate in good faith," Bessent told NBC anchor Kristen Welker on Sunday.

On Friday, Trump said his administration will unilaterally impose new tariff rates on some countries in the coming weeks, "telling people what they will be paying to do business in the United States."

"The negotiating leverage that President Trump is talking about here is if you don't want to negotiate then it will spring back to the April 2 level," Bessent added, noting that many countries faced tariff rates far higher than the current 10%.

Bessent did not specify when countries might see those higher tariff rates take effect, but told CNN's "State of the Union" on Sunday that the U.S. is focused now on making deals with 18 "important" trading partners.

"There are a lot of smaller trading relationships that we can just come up with a number. My other sense is that we will do a lot of regional deals - 'this is the rate for Central America, this is the rate for this part of Africa,'" Bessent told CNN anchor Jake Tapper. "But what we are focused on right now are the 18 important trading relationships."

Bessent admitted that consumers will likely feel the effects of the Trump administration's tariffs. Last week, Walmart Inc. $(WMT)$ said it plans to raise prices due to the higher cost of importing goods, leading Trump to say on social media that Walmart should "EAT THE TARIFFS."

Read more: Prices are probably going up at Walmart. Watch for Target and other retailers to detail the tariff impact this week.

"So Walmart will be absorbing some of the tariffs. Some may get passed on to consumers," Bessent told Tapper.

Bessent said he spoke with Walmart Chief Executive Doug McMillon on Saturday. "I didn't apply any pressure," Bessent told NBC's Welker. "Doug and I have a very good relationship, so I just wanted to hear it from him."

Bessent also dismissed Moody's downgrade of America's AAA credit rating late Friday, which cited spiraling U.S. government debt.

"I think that Moody's is a lagging indicator," he told Welker, blaming the Biden administration for an "inherited 6.7% deficit to GDP."

"There's trillions of dollars coming into the U.S.," he told Tapper. "So we are seeing competence from investors, so I don't put much credence in Moody's."

"Larry Summers and I don't agree on everything, but, in 2011, the last time or two times ago when he had a downgrade, he pooh- poohed it," Bessent added.

More: The U.S. just lost its last pristine credit rating. What that means for markets.

-Mike Murphy

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May 18, 2025 16:25 ET (20:25 GMT)

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