Global stock markets fall heavily after the latest comments from Donald Trump.
Global stock markets fall heavily on Monday
The US President suggested his next round of tariff announcements, expected on Wednesday, will hit all countries, rather than just those who sell more goods to the US than they buy.
Trump’s plans to slap tariffs – taxes on US firms importing goods – is an attempt to force American consumers to “buy American” and for US firms to “build American,” though many US companies say it is not simple to start making more things in the country when they have established factories and workers overseas.
Either way, what’s currently happening in the world is the short-term effect of all of this.
Since Trump’s comments, Asian markets have fallen, and European markets have opened down.
The president had said his new tariffs (set for Wednesday) will hit “all countries.”
The shares have fallen due to the hope that “reciprocal tariffs” would only target countries that have the largest trade imbalances with the US.
Trump told reporters on Air Force One: “You’d start with all countries. Essentially all of the countries that we’re talking about.”
On Monday, the threat of a deepening trade war spooked investors. In Toyko, Japan’s Nikkei index lost 4%, and South Korea’s Kospi fell 3%.
The wave of selling swept into European markets as well – the UK’s FTSE 100 fell 1.3% to a two-week low, and Germany’s DAX and France’s CAC both lost 2%.
How is the world responding?
The UK is reportedly negotiating with the US to try to agree on an exemption to tariffs.
But how have other states been responding?
- China introduced a 10-15% tax on some US agricultural goods, and also targeted US aviation, defence and tech firms – warning it is ready for “any type” of war
- Canada imposed a 25% tariff on US steel, aluminium and other goods worth about C$60bn ($42bn; £32bn). Ontario Premier Doug Ford has also repeatedly threatened he’ll target US electricity sources
- Mexico’s President Claudia Sheinbaum has meanwhile adopted a “wait and see policy”, and has so far delayed introducing retaliatory measures while negotiations with the US continue
- The EU will introduce tariffs from 13 April on US goods worth €26bn (£22bn). This covers items ranging from American alcohol to steel and aluminium production
Additional sources
Global stock markets fall as new Trump tariffs loom – The Guardian
Global stock markets tumble as Donald Trump’s tariffs loom – FT
Global stock markets slide days before Trump tariffs take effect – BBC