Global stock markets were dive, dollar rally, oil prices jumped and world leaders read tight-for-tat measures. He had almost immediate reactions to US President Donald Trump’s Canada, Mexico and China for the new tariffs, signed over the week.
From Tuesday, the United States was due to implementing 25% of additional duties on imports from Canada and Mexico and 10% on goods from China above the current tariff rate. Energy imports from Canada will be subject to 10% tap. However, a few hours before he became effective, Trump stopped the levy on both Mexico and Canada for 30 days as the conversation continued.
Trump Tap Targeting the three largest trading partners in the United States, they are unprecedented in their scope and scale. Economists have said that their influence wants the possibility of paralyzing economic growth around the US and the world.
While the President justified the move as an attempt to address large trade imbalances and fight illegal drugs trade and irregular immigration, Dutch ING Bank Chief Economist Carrston Brezsky warns that Tariff “fully” fully ” From the beginning of “has been marked. Business run away may still grow.
“Donald Trump is not only barking, he is biting and giving all his election promises,” Brezsky told DW.
Economics Professor Ridiger Bachman at the University of Notre Dame in America said “how” how “how”[Trump] There is no difference between traditional friends and enemies, saying that “China is getting a better deal than Canada and Mexico.”
Bachman told DW that the US President was throwing the global trade order in “anarchy”.
Shock due to fears of trade war
Reacting to the weekend announcement, the Asian stock markets fell to 2% on Mondays, which also liked the so -called year of the snake with a toxic bite. Some European markets, including Frankfurt and Paris, saw similar drops after the US President warned, the European Union would be “very soon” by a similar Taf.
Shares fell over 4% on Monday morning in European vehicle manufacturers measured by the Stoxx 600 index. German Automkers – who export thousands of cars to the US annually from Mexico – is likely to give a tough competition by the new tariff. According to analysts of the US Investment Bank Stephell, about two-thirds of the US bound cars of Volkswagen in Mexico are produced.
The North American auto industry is deeply integrated, in which car parts are crossing boundaries several times during the manufacturing process. The new tariff threatened to interrupt the thesis complex supply chain, making the German car manufacturer VDA talk of “a significant blow for rule-based global trade”.
The US stock futures were rapidly below Monday, the biggest week for the fourth quarter earnings. More than 120 S&P 500 companies are ready to report their results, including Google Parent Alphabet, Amazon and Walt Disney Company.
The dollar increased against other major currencies against the Mexican peso, 2.3% and Canadian dollars and more than 1% against the euro, which was warned by the European Central Bank (ECB).
Oil prices increased by more than 2% over the possibility of supply disruption from tariffs on Canadian energy and without giving more information after Trump’s threat, threatened the threat related to oil and gas sector in mid -February.
Tariffs cried, targets prepares anti -counter
Canadian Prime Minister Justin Trudeau confirmed on X on Monday evening that the US Tafs were “placed for at least 30 days”, after two calls and Trump in the first day.
In the weekend, Trudeau returned to Trump’s move by announcing a 25% levy at $ 107 billion (€ 104.5 billion) of US imports. Leaders of several Canadian provinces announced their own retaliation, including an immediate stop for the purchase of American liquor.
Before the US Tiffs were held, Trudeau effectively called for boycott of American goods, asked the public to select the products made from here in Canada. ” In a speech, he warned the Americans that the tariffs would put us at risk and increase the cost of food and gasoline.
Mexican President Claudia Xinbaum first confirmed on Monday that Trump had agreed to break the tariff on Mexico for a month, in return, expanding his commitment on social media.
“The Mexico National Guard wants to immediately strengthen the northern border with 10,000 members, to prevent drug trafficking from Mexico to the United States, especially in Fentaenil,” Shinbam posted on X.
Over the weekend, Shinbam ordered his economy minister to “implement Plan B”, which included “tariffs and non-tale measures” unspecified on American imports.
Meanwhile, China said that it would “take necessary protests to protect its rights and interests.” Beijing said that Trump’s move violates the rules of the World Trade Organization (WTO) and vowed to bring a case to the body that controls global commerce.
China’s Finance Ministry later announced plans for 15% Taifs on the import of US liquid natural gas (LNG), coal and many other items.
Trump later said on Monday that he was due to interacting with his Chinese counterpart Xi Jinping within the next 24 hours.
Inflation, increase in the possibility of recession
Dutash Bank wrote on Monday that the new tariffs, whichever they are effective, will affect about 44% of all imports for America – Price Around $ 1.35 trillion – And possibly American will increase inflation by 1%.
For American consumers, measures can mean high prices for essential commodities such as oil, electronics and grocery items, which is increasing the current cost of a living crisis. High inflation may motivate the American Federal Reserve to maintain or increase interest rates, some economists warned.
Deutch Bank said that it has been said that continuous tattifies would be “much larger in economic quantity” for Canadian and Mexican economies compared to Brexit in the UK. Germany’s largest private lender hopes that the two countries will get recession punishment in the coming week.
Tatters are expected to add a cost of $ 60 billion to the North American auto industry, Bloomberg on Monday cited the research by automotive consultant ElixParters. Different data of Wolf Research predicted that the average price of a new car in the US could increase by about $ 3,000.
Between concerns that the European Union is on Trump’s radar, the top diplomat of the block Kaja Kalas on Monday warned that “there are no winners in the business wars,” we add: “We add:” [Europeans] America is needed, and America is also needed.
When he took over on January 20, Trump signed an executive order to investigate whether American countries are a country of discriminatory or supernatural taxes on American corporations. This sample is primary in the European Union and the search is going to be published on 1 April.
Bachman said that the European Union is a “big market and has more bargaining power.” This can help the block avoid high taff “if the European stick is together and does not try to get special deals on a bilateral basis.”
But he warned that Hungary Prime Minister Victor Orban and Italian Prime Minister Giorgia Meloni were threatened by the European Union unity.
Edited by: Uwe Hessler
Editor’s note: This story was first published on 3 February 2025, and was updated several times to reflect the latest development.