WASHINGTON—A Supreme Court ruling limiting the president’s ability to impose sweeping tariffs could modestly ease inflation pressure on credit union members’ household budgets — and, over time, help stabilize CU deposits and loan demand — even as trade policy uncertainty lingers, according to Brian Turner, president and chief economist at Meridian Economics.
The high court’s decision narrows the executive branch’s use of the International Emergency Economic Powers Act (IEEPA) for broad tariff actions. However, as widely reported by news outlets, President Donald Trump quickly responded, imposing a 10% universal global tariff under other statutory authority — specifically Section 122 of the Trade Act of 1974.
Turner noted the ruling “referred to the use of the 1977 IEEPA and the use of sweeping tariffs,” but emphasized that the president “continues to have the authority under the Trade Expansion Act of 1962 to impose duties on specific goods.” In fact, many existing tariffs on targeted products remain in place, he noted.
Economic Impact: Less Shock, But Not No Shock
Turner said his initial review suggests the court’s decision may reduce some of the economic drag that aggressive tariff expansion had created.
“The ruling may in effect reduce the negative effect that the pre-decided ruling on tariffs did have on the economy,” Turner said, including “less upward pressure on prices or rising job losses in the case of aggressive tariffs.”
Still, Turner cautioned on Friday that broader tariff use may simply shift to other legal mechanisms. Under Section 122, the president can invoke a 10% universal tariff by executive order, Turner noted on Friday. Under Section 232, targeted tariffs on key sectors can be imposed for up to 150 days before requiring congressional extension, Turner stated on Friday, before Trump signed the 10% tariff Executive Order later that day. On Saturday, Trump announced he would raise his new, global tariff to 15%.
Congress’s constitutional “power of the purse,” Turner added, makes it more difficult to rapidly resolve trade imbalances through legislative action, potentially prolonging policy uncertainty.
What It Means For Households
For credit union members, the near-term effect may be more muted than headlines suggest.
Earlier tariffs primarily applied to goods produced outside the United States. Turner pointed out that foreign companies manufacturing inside the U.S. were not subject to those import duties — and that structure remains important.
“If foreign companies produce goods inside the United States, the previous tariffs were not applied,” he said. “So, this should continue to incent factory construction and foreign investment.”
That investment, he argued, could support job growth and wage gains. With consumer spending accounting for roughly two-thirds of U.S. GDP, sustained employment and rising average wages are critical buffers against trade-related cost pressures.
Turner noted that average wages are currently increasing at a pace faster than consumer inflation, supporting disposable income growth — an important stabilizer for household balance sheets even amid trade policy volatility.
What Credit Unions Might Expect
Turner said credit unions should not expect immediate, dramatic changes.
“There is nothing that will be noticeable directly by credit unions,” he said.
However, improving wage growth combined with moderating inflation could gradually strengthen member demand. Turner said credit unions “will eventually experience growing demand for products and services at a time when the pace of economic growth has already started to show slowing.”
That dynamic could:
- Help stabilize core deposits, which have been under pressure for several years
- Support vehicle lending demand
- Boost home improvement financing
Additionally, Turner expects “slightly less volatility in mortgage rates,” which could open another refinancing window even if new home purchase activity remains subdued.