Markets down after Trump hits more countries with steep tariffs
Global markets have reacted negatively to US President Donald Trump's latest wave of tariffs on dozens of countries, including trading partners such as Canada, Brazil, India and Taiwan.
Trump announced tariffs of 35 per cent on many goods from Canada, 50 per cent on Brazilian products, 25 per cent on Indian goods, 20 per cent on Taiwanese imports and 39 per cent on items from Switzerland.
In an executive order, Trump ordered duties of ten to 41 per cent on 69 territories to take effect next week.
The changes would take the effective US tariff rate to 18 per cent from 2.3 per cent last year, according to Capital Economics.
The Stoxx in Switzerland has fallen nearly two per cent today and is set for its biggest weekly drop since early April when Trump announced his Liberation Day tariff regime.
Both Nasdaq futures (-2.2 per cent) and S&P 500 futures (-1.85 per cent) have declined too, although the market response has not been as volatile as seen in April, according to Wei Yao, research head and chief economist in Asia at Societe Generale.
"We are all getting much more used to the idea of 15-20 per cent tariffs being manageable and acceptable, thanks to the worst threats earlier," she said.
However, figures from the US Commerce Department released on Thursday show prices for home furnishings and durable household equipment jumped 1.3 per cent in June, the biggest gain since March 2022.
In reaction to the tariff announcement, Switzerland said it would seek a "negotiated solution" with the US.
Taiwan President Lai Ching-te said the 20 per cent tariff on the island was "temporary" and that he expected to reach a lower figure.
Parks Tau, South Africa's trade minister, said he was seeking "real, practical interventions" to defend jobs and the economy against the 30 per cent US tariff imposed on the country.
Pichai Chunhavajira, the Thai finance minister, said the reduction of tariffs from 36 per cent to 19 per cent would assist the country's economy.
"It helps maintain Thailand's competitiveness on the global stage, boosts investor confidence and opens the door to economic growth, increased income and new opportunities," he said.
Similarly, Australian Trade Minister Don Farrell said Australian products could become more competitive in the US market after Trump kept the tariff at ten per cent.
Goods from all other countries not listed in Trump's order will face a tariff of ten per cent.
Trump's order said some trading partners, "despite having engaged in negotiations, have offered terms that, in my judgment, do not sufficiently address imbalances in our trading relationship or have failed to align sufficiently with the United States on economic and national-security matters."
He issued a separate order for Canada that raises the rate on Canadian goods subject to fentanyl-related tariffs to 35 per cent, from 25% per cent previously, saying Canada had "failed to cooperate" in curbing illicit narcotics flows into the US.
Mark Carney, the Canadian Prime Minister, said he was disappointed by Trump's decision and vowed to take action to protect Canadian jobs and diversify exports.
Donald Trump announced revised tariffs for 69 countries on Thursday. (Pic: Eric Lee/Bloomberg via Getty Images)
Mexico, meanwhile, received a 90-day reprieve from higher tariffs of 30 per cent to allow for negotiations to continue.
India is in trade talks with the US after Washington imposed a 25 per cent tariff, a move that could impact about $40bn worth of its exports, an Indian government source with knowledge of the talks told Reuters.
Photo: Donald Trump. (Pic: Eric Lee/Bloomberg via Getty Images)
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