Trump slams Washington Post report that he will scale back tariff plan: ‘Another example of Fake News’

President-elect Donald Trump on Monday slammed a Washington Post report claiming he planned to scale back his proposed tariffs as “another example of Fake News.”

In an article published Monday morning, the newspaper, which is owned by Amazon billionaire Jeff Bezos, reported that the president-elect was considering scaling back his “universal” tariff plan to only affect certain goods — a significant trim to one of his most controversial policies.

“The story in the Washington Post, quoting so-called anonymous sources, which don’t exist, incorrectly states that my tariff policy will be pared back. That is wrong,” Trump said in a post on his social media platform Truth Social.

“The Washington Post knows it’s wrong. It’s just another example of Fake News.”

The Washington Post article cited three anonymous sources familiar with the campaign.

The dollar dropped as much as 1.07% on the session against a basket of major currencies after the Washington Post report — but pared losses following Trump’s denial.

The dollar index, which measures the greenback against a basket of currencies, fell 0.64% to 108.26, with the euro up 0.76% at $1.0386. The dollar was on pace for its biggest daily percentage drop since Nov. 27.

The dollar index had reached a two-year high of 109.54 last week en route to its fifth straight weekly gain, as the resilient economy, the potential for higher inflation from tariffs and a slower pace of rate cuts from the Federal Reserve have buttressed the greenback.

“The reality here is that Trump’s Truth Social views are going to drive FX volatility for a while and (Monday) morning’s reaction is indicative of the underlying dynamics,” said Karl Schamotta, chief market strategist at Corpay in Toronto.

“The market consensus is that Trump’s bark will be worse than his bite, and any news that confirms that concept is fuel for rallying in risk assets and for a decline in the dollar and Treasury yields, but the reality here is that the downside risks remain and there’s no clear endpoint for that,” Schamotta added.

The paper reported that early talks have discussed restricting the tariffs to affect key goods whose supply chains the Trump team wants to bring back to the United States.

A Washington Post spokesperson confirmed the publication stands by its reporting.

Under the new plan, the tariffs would target the defense industrial supply chain, specifically steel, iron, aluminum and copper; medical supplies, like syringes, needles and vials; and energy production, like batteries, rare earth minerals and solar panels, the report said.

While still extensive, the reported tariff plan would pale in comparison to the 10% to 20% across-the-board import tariff that Trump mentioned during his campaign. 

It is unclear how the newly reported plan would intersect with Trump’s previous plans to impose 25% tariffs on Mexico and China, and an additional 10% on China unless it cracks down on drug trafficking.

The internal tariff plans are being led by Vince Haley, a Trump campaign aide set to run the White House Domestic Policy Council; Scott Bessent, Trump’s Treasury pick; and Howard Lutnick, Trump’s commerce secretary pick, the Washington Post reported.

The president-elect has faced backlash for his proposed tariffs, with some economists fearing the protectionist policies could reheat inflation by raising input costs and ultimately spiking prices for US consumers and manufacturers.

On Monday, however, economists at the American Economic Association conference in San Francisco — including former Fed Chairman Ben Bernanke — said Trump’s policies may not be as inflationary as early analysis had suggested.

“Trump policies, whatever their merits on public finance grounds, probably will be modest in terms of their effect on the inflation rate,” Bernanke said. “Barring some very unusual situation, including perhaps political risks, it doesn’t seem like that’s going to really shift the inflation path radically.”

Other economists in attendance agreed, saying the president-elect’s policies were unlikely to cause the frightening shake-up that analysts had earlier forecast.

“President Trump has promised tariff policies that protect the American manufacturers and working men and women from the unfair practices of foreign companies and foreign markets,” Brian Hughes, a spokesman for the Trump transition team, told the Washington Post in a statement.

“As he did in his first term, he will implement economic and trade policies to make life affordable and more prosperous for our nation.”

During his first term, Trump launched tariffs on more than $360 billion worth of goods from China, in particular steel and aluminum, The Post reported.

Trump’s transition team declined to provide further comment.