US President Donald Trump’s sweeping tariff plans battered global markets again yesterday after he said foreign governments would have to pay ‘a lot of money’ to get the levies removed, while US stocks got a brief lift on hints of a pause, only to slide again.
Financial markets across the globe posted a third day of losses as investors worried that steep trade barriers around the world’s largest consumer market could lead to a recession.
Asian and European shares plunged and oil prices plummeted as investors feared the duties Trump likened to ‘medicine to fix something’ at the weekend could lead to higher prices and weaker demand.
The global trade war touched by Trump’s sweeping tariffs escalated further as the US president threatened to increase duties on China and the European Union proposed counter-tariffs of its own.
Trump’s advisers said he would be willing to negotiate with countries that are scrambling to head off tariffs as high as 50 per cent due to take effect tomorrow.
But the president himself ruled out discussions with Beijing as he ratcheted up a confrontation with the world’s No 2 economy.
Trump said he would impose an additional 50pc duty on US imports from China tomorrow if it did not withdraw the 34pc tariffs it had imposed on US products last week. Those Chinese tariffs had come in response to 34pc ‘reciprocal’ duties announced by Trump.
The European Commission, meanwhile, proposed counter-tariffs of 25pc on a range of US goods, including soybeans, nuts and sausages, though other potential items like alcoholic drinks were left off the list, according to a document seen by Reuters.
Officials said they stood ready to negotiate a ‘zero for zero’ deal with Trump’s administration. “Sooner or later, we will sit at the negotiation table with the US and find a mutually acceptable compromise,” EU Trade Commissioner Maros Sefcovic said at a news conference.
The 27-member bloc is struggling with tariffs on cars and metals already in place, and faces a 20pc tariff on other products. Trump has also threatened to slap tariffs on EU alcoholic drinks.
The back-and-forth injected further turbulence into global financial markets, which have fallen steadily since Trump’s announcement.
US stocks swung wildly, spiking after a report that Trump was considering a 90-day tariff pause, then turned negative again after the White House dismissed the report as ‘fake news’.
Goldman Sachs raised the odds of a US recession to 45pc.
Trump administration officials say he is following through on a promise to reverse decades of trade liberalisation that he believes has undercut the US economy. But they also said he is willing to negotiate with dozens of countries that have reached out for talks.
&uuid=(email))