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Bank of Singapore: Trump Early Strikes on Tariffs Likely to Hit Mkt Confidence, Dent Econ Growth in Many Countries
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Bank of Singapore released a research report on Trump's Early Strikes on Tariffs. Trump signed an executive order last Saturday announcing a 25% tariff hike on imports from Canada and Mexico, and a 10% additional tariff on Chinese goods. Trump justified the tariffs as a response to illegal immigration and drug inflows. The White House confirmed that the new tariffs will start on Tuesday. The financial markets are facing their first major test since Trump took office, Mansoor Mohi-uddin, Chief Economist at Bank of Singapore, said. The current US administration started trade war only two weeks after taking office, which is much earlier than the market consensus, and is bound to impact market confidence, Mohi-uddin said. The resumption of trade wars will have 4 major impacts on the market this year, Mohi-uddin added. Of which, tariffs will be a drag on economic growth. Canada and Mexico will be the most affected in this regard, but the US and Chinese growth will also be hurt. The US additional tariff of 10% on China's exports may be lower than expected, but the US tariff could eventually rise to 20-30% given China's large trade surplus of US$300 billion with the US, causing Chinese growth to fall to 4.2% in 2025, from 5% in 2024. AAStocks Financial News |
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