Stocks Skid, Dollar at 3-Week Top as Trump Announces Auto Tariffs
Trump’s Auto Tariffs Shake Global Markets
Asian shares skidded alongside Wall Street on Thursday as the dollar hovered near a three-week high. This followed U.S. President Donald Trump’s announcement of new 25% tariffs on all auto imports, escalating a global trade war that risks fueling inflation.
Market Reactions
- Asian Markets: Japan’s Nikkei fell 1.2%, with Toyota Motor shares tumbling 3.4%. South Korea’s KOSPI dropped 0.7%, and Chinese EV makers like Nio and Xpeng also saw declines.
- U.S. Automakers: General Motors slumped 6%, while Ford shares fell nearly 5% after the announcement.
- Wall Street Futures: Nasdaq futures dropped 0.2%, and S&P 500 futures fell 0.1%.
International Responses
Japan’s Prime Minister Shigeru Ishiba stated that all options were on the table in response to the tariffs. Canada hinted at retaliatory duties, while the European Union expressed regret but sought negotiated solutions.
Economic Implications
Analysts warn that the tariffs could stoke U.S. inflation, with the Federal Reserve already pausing its policy easing cycle. St. Louis Fed President Alberto Musalem noted the potential for higher inflation and lower growth.
Currency and Commodity Markets
- Dollar: The dollar index rose to a three-week high of 104.71 before settling at 104.46.
- Gold: Prices increased 0.3% to $3,028 per ounce, nearing a record high.
- Oil: Brent futures rose 0.1% to $73.87 per barrel.
For more details, read the full article on Reuters.
