U.S. trading partners are in last-minute negotiations ahead of President Trump's newly imposed tariff deadline. CBS News MoneyWatch correspondent Kelly O'Grady has the latest.

Washington

Donald Trump has signed an order to impose tariffs imports into the U.S. from countries including China, Mexico and Canada.

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Negotiations are ongoing as new US tariffs introduced by President Trump are set to take effect, with some countries still seeking exemptions. The tariffs will see rates for certain countries, such as Switzerland, rise sharply from 10 percent to as high as 39 percent, while India faces a combined tariff rate of 50 percent due to its purchase of Russian oil. Businesses that managed to import goods before the deadline may avoid the higher rates, but others will face increased costs that could be passed on to consumers. In addition, President Trump is expected to nominate a new Federal Reserve governor, likely someone supportive of cutting interest rates, with the possibility that this nominee could later become chair when Jerome Powell's term ends.

Last-minute negotiations taking place as Trump tariff deadline nears

All right, we're less than 24 hours away from some of the president's new tariffs taking effect officials from some countries are still negotiating at the 11th hour thought, though it's unclear I should say if they'll succeed in those efforts and CBS News Money Watch correspondent Kelly O'Grady joins me now. So Kelly, good to have you on set here with me. What are some of the expectations when these new policies take effect tomorrow? So it's going to be a higher tariff rate. Remember, there's been a baseline 10 percent tariff for most countries outside of China. And we've also had some of those sector tariffs like autos. But this would jump significantly. For example, Switzerland we've been talking about a lot is going to jump from 10 percent to 39 percent and sort of runs the gambit anywhere between 15 percent to 41 percent. Now, that doesn't mean that businesses are going to have to immediately pay that, because if businesses were able to get their orders and those ships moving from one place to another prior to 12 or one on August 7th, so tomorrow they and they actually come to the port before October 5th, they don't have to pay that higher tariff rate. So I think a lot of businesses sort of got trying to get ahead of this deadline, tried to get those goods into the country. But after that, yeah, they're going to have to pay significantly higher costs that could get passed on to you and me. No doubt we are coming down to the wire with a lot of these last minute negotiations. Can you just walk us through some of these 11th hour talks that are still happening? So I mentioned Switzerland. That is one. The president of Switzerland, as well as the economic team, is going to meet with Rubio today, Marco Rubio. And we do know that they are trying to avoid that 39 percent tariff. Remember, we get watches, chocolate, pharmaceuticals from Switzerland. The other thing that I want to call out, though, this is not necessarily a negotiation, but it is some breaking news. India. We have talked about that a lot. They have a 25 percent tariff that is going into effect tomorrow. The president just signed an executive order saying that there will be an additional 25 percent tariff. So that would bring the total tariff rate up to 50 percent on India because they're buying Russian oil. And of course, the president is trying to apply economic pressure to Russia to stop the war in Ukraine. And I just want to say this is the very first time that we would ever see tariffs used in this way in such a blanket way to apply such economic pressure as the International Chess Board keeps moving. Yes, certainly some uncharted territory here. And I want to change gears here. President Trump said yesterday he'll have to pick two or he'll have his pick, I should say, to replace a Fed governor by the end of the week. What do we know about that? So one, I think we can say with almost certainty that President Trump will pick someone that is in favor of cutting interest rates. We already know that two members of the Fed board of governors at the last meeting did choose to or did vote to cut interest rates. You would expect this person also to be in that mindset. The other thing on CNBC yesterday in that interview that he did with those folks, he said he might pick a replacement that would end up becoming the chair's placement. Chair Jerome Powell's term is up mid 2026. So that's something to keep your eye on. Yeah, we know the president has been a vocal critic of Fed Chair Jerome Powell. Kelly O'Grady, we appreciate it. Thank you for your insight.

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Last-minute negotiations taking place as Trump tariff deadline nears

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