On Saturday, the United States started imposing a 10% “baseline” tariff on all imports, prompting President Donald Trump to urge Americans to remain resilient amidst market tumult. The UK and France are among the numerous countries affected, with their leaders stating that no option will be ruled out. China, which has been the most severely impacted by Trump’s tariffs, has announced a substantial retaliatory response.
US stock markets experienced significant declines on Friday, with all three major indices plummeting by more than 5%. The S&P 500 dropped nearly 6%, marking the worst week for the US stock market in recent years. Protests against Trump’s policies were held in Washington DC, New York, and other cities, with thousands participating.
President Trump characterized the market fluctuations as “an economic revolution” that the US will ultimately triumph in. Despite the turbulent effects of his policy changes on global supply chains, he insisted that the final result will be historic. The FTSE 100 suffered its steepest decline in five years, while European and Asian markets also experienced significant drops.
Elon Musk, a close ally of Trump and the head of the Department of Government Efficiency (Doge), stated that the US and Europe could move towards a “zero-tariff situation,” potentially leading to a free-trade zone between Europe and North America. The EU is expected to face a 20% levy and upcoming tariffs of up to 50% on certain goods from countries deemed the “worst offenders” for trade imbalances with the US.
British Prime Minister Sir Keir Starmer engaged in multiple calls with world leaders, emphasizing that a trade war should be avoided but acknowledging that all options should be considered. Both Starmer and Macron expressed concerns about the global economic and security consequences, particularly in South East Asia.
China, the world’s second largest economy, was the most affected by Trump’s “reciprocal tariffs” targeting nations deemed unfriendly to US interests. Beijing responded with retaliatory tariffs of 34% on US imports, the same percentage implemented by Washington on Chinese imports. China also lodged a complaint against the new tariffs with the World Trade Organisation.
Over 1,200 demonstrations opposed to Trump and his changes to the leadership of the US government are expected to take place across the US, marking the largest single day of protests since the policy changes were announced. While the White House has yet to comment on the protests, images of Trump with a copy of the New York Post were captured.
The impact of the tariffs on trade has been evident. In the UK, Jaguar Land Rover announced that it would temporarily halt shipments to the US as it addresses the new trading terms.
Source: https://www.bbc.com/news/articles/c8rg5lp7m8no
