Trump’s Tariff Gamble Rocks Fashion and Luxury Markets
Investing has always been about calculated bets—some safe, some risky—but betting nonetheless. Markets thrive on predictability, finding comfort even in anticipated losses when they’re less severe than expected. But President Trump is the wild card that defies every predictive model.
This week, Trump’s sweeping tariffs sparked an unprecedented market rout, erasing over $6 trillion from Wall Street in just two days, marking its worst week since 2020. The tariffs have effectively built a wall isolating the U.S. economy, sending shockwaves through virtually every sector and intensifying fears of a looming recession.
Fashion and luxury are not immune. With America importing over 98% of clothing and 99% of shoes, prices across the industry are set to rise sharply. European luxury houses like LVMH and Kering face a sudden 20% tariff on handbags and fashion imports to the U.S. Richemont’s Swiss watches will see a 31% levy. Every piece, from a Hugo Boss suit to Moncler jackets and Prada eyewear, is caught in the tariff crossfire.
Department stores banking on international shoppers will soon feel the pinch, as Asian and European visitors are less likely to splurge amidst inflated prices. And for American designers relying on imported fabrics and materials? Tariffs, tariffs, and more tariffs.
How long will the disruption last? Until a certain resident of the White House feels American manufacturing has sufficiently rebounded. Until then, the luxury and fashion sectors must brace themselves and navigate this unpredictable terrain. Welcome to the ultimate high-stakes gamble.
What can be done?
Pause. Take a deep breath. Remember, change is constant—especially the kind we can’t control.
But what we can control are the connections we nurture. Now’s the time to lean into the relationships that matter—your teams, your customers, your partners—and find new, meaningful ways to add value.
After all, the best response to uncertainty isn’t panic, it’s purpose.
Warm Regards,
Kenneth Richard
Chief Impressionist
