Trump’s action is likely to be felt in certain industries. One official with an industry group said the steel tariffs would deal a major blow to U.S. factories, which are already struggling to meet demand amid rising supply costs, a shrinking pool of workers and transportation shortages.

“It’s a mistake. It’s a big, big mistake,” Timothy Fiore, chairman of the Institute for Supply Management’s factory survey committee, said by phone on Thursday. “It is going to add so much disruption and cost here. We don’t make a lot of those steels anymore, so you’re going to have to import them anyway.”

Big sectors of the U.S. economy are major steel consumers, and the material is present in consumer goods from cars to appliances and lawn mowers, said  Rufus Yerxa, president of the National Foreign Trade Council in Washington, a business group advocating open trade.

Growth Goal

Most economists were already unconvinced that Trump will achieve his goal of sustained 3 percent growth, with the effects of tax cuts fading after an initial boost this year. Analysts surveyed by Bloomberg News see U.S. gross domestic product growing an average 2.7 percent in 2018, up from 2.3 percent last year, before slowing to 2.4 percent in 2019.

Trump’s Tariffs Deal a Blow to Already-Shrinking U.S. Auto Sales

The tariffs could boost annual inflation rates by 0.1 percentage point, though “any pass-through to final goods prices is likely to be less than full and come with a lag,” according to Barclays.

It’s still possible that Trump could stop short of implementing the tariffs, or exempt certain steel products or countries from his new policy. After all, the president’s $1.5 trillion tax-cut legislation was aimed at bringing relief to consumers, whereas the import tariffs would end up as a penalty on Americans’ purchases of foreign-made goods, with a full-blown trade war potentially boosting prices of everything from cars to clothing.

The tariffs reverberated around the world. Stock prices for Japanese and South Korean steelmakers tumbled and U.S. allies pushed back. The Australian Industry Group warned that the move may trigger retaliation and a spread of protectionist policies around the globe.

“You may think that it’s protecting jobs in the U.S.,” said Michael Gapen, chief U.S. economist at Barclays, who formerly worked at the Fed. “But if you do create mini trade wars and trade volumes suffer, you may, on net, lose more jobs than you think you’ve saved.”