Global financial markets continued their depreciation for a third consecutive day on April 7, responding to US President Donald Trump’s unprecedented tariffs on the majority of the United States’ trading partners. The imposition of tariffs is expected to have broad effects on world economic growth due to increased manufacturing costs, plummeting business confidence, market volatility, and disruptions in supply chains.

European Union finance ministers convened in Luxembourg on Monday to discuss a €26 billion ($28.46 billion) countermeasure in response to Trump’s earlier tariffs on aluminum and steel. Sergio Leone of the European Commission stated that Brussels was “prepared to defend its interests” with countermeasures while also expressing a commitment to negotiating with the US.

China was the first major economy to retaliate with tariffs on US imports, implementing 34% extra levies on American goods and restricting exports of rare earth materials. The levies imposed by China are scheduled to take effect on Thursday. India, another nation affected by the tariffs, does not plan to retaliate; Reuters reported that New Delhi is planning to cut some tariffs on US imports and has already made an attempt to negotiate a new trade deal with Washington.

Fears of a global recession are growing, with JP Morgan stating that the probability has increased to 60% by the end of the year. China, India, and Vietnam are the countries that have been hit the hardest by the levies. Goldman Sachs stated in a report over the weekend that it had planned to upgrade its growth forecast for China before the tariffs were announced. Moody’s Analytics economist Steve Cochrane warned that the US could enter a recession “very quickly” if tensions escalate further.

Source: https://www.dw.com/en/trump-s-tariffs-trigger-alarm-over-looming-recession/a-72158605?maca=en-rss-en-all-1573-rdf