Fitch Ratings reduced its latest estimate for the U.S. tariff rate on the rest of the world, amid downward revisions for Canada and Mexico, along with lower levies on India and Switzerland.
In a new report, the rating agency now estimates the effective tariff rate on U.S. imports at 12.7%, down from its previous estimate of 13.6%.
The decline reflects a couple of new trade deals, along with revisions to its estimated effective tariff rates for Canada, down to 4.6% from its previous estimate of 5.9%, and Mexico, down to 5.4% from 5.8%.
Those downward revisions reflect the latest customs data, which indicated that a rising share of imports from Canada and Mexico are entering duty free based on compliance with existing trade agreements.
“Fitch now assumes that 80% of goods imports from Mexico and 85% of goods imports from Canada will be duty-free under the current tariff regime, compared with our earlier assumption of 75%,” it said.
Alongside those revisions, Fitch said that the estimated effective tariff rate also decreased thanks to a new trade agreement with India, reached earlier this month; and a deal with Switzerland taking effect that reduced its estimated rate to 6.1% from 14.6%.
Fitch also noted that elevated tariffs on China have driven a sharp decline in its imports to the U.S., which were down roughly 45% at the end of 2025, compared with 2024. That drop was offset by increased imports from Taiwan and Vietnam, it said.
Notwithstanding the shifting tariffs, “The U.S. continues to run a trade deficit of roughly US$1 trillion on an annualized basis,” Fitch said, adding, “This has not significantly changed over the last five years.”