US President Donald Trump signed an executive order on Thursday imposing tariffs ranging from 10% to 41% on US imports from dozens of countries and foreign locations.
Rates were set at 25% for India's US-bound exports, 20% for Taiwan's and 30% for South Africa's. Trump also signed an executive order on Thursday increasing tariffs on Canadian goods to 35% from 25%, the White House said.
Asian stock markets and futures for US stocks and Europe slipped on the news.
Thomas Rupf, chief investment officer Asia, VP Bank, Singapore, said: "The latest tariff announcement offers some surface-level clarity, but beneath it lies a fog of uncertainty. While major Asean manufacturing countries managed to secure similar tariff rates in the 19% to 20% range, potentially minimising intra-bloc tariff arbitrage, the broader picture remains murky.
"The figures exist only on paper for now. Implementation and enforcement will ultimately determine the real impact.
No real winners in trade conflicts. Despite some countries securing better terms, the overall impact is negative. We’re entering an era of higher barriers to trade which will have an impact and hurt growth
— Thomas Rupf, chief investment officer Asia, VP Bank, Singapore
"No real winners in trade conflicts. Despite some countries securing better terms, the overall impact is negative. We’re entering an era of higher barriers to trade which will have an impact and hurt growth."
Prashant Bhayani, chief investment officer Asia, BNP Paribas Wealth Management, Singapore, said: "The average tariff rate roughly on reciprocal is going from about 2.5% to 15%. That's a steep change. However, if everyone's getting tariffed, it's more about the relative because that affects how much you get relative to your competitors.
"It would be more disruptive if you are at a much higher rate than your competitors. In the short-term, there's trade diversion to another country you compete with. But at this point, we're not seeing it."
Vasu Menon, MD Investment Strategy, OCBC, Singapore, said: "The latest announcements some degree of closure about Trump's country-based tariffs. However, uncertainty remains about additional sector-based tariffs for industries such as pharmaceutical and semiconductors. The impacts of Trump’s tariffs are playing out and will take time to work their way through the US. and other economies.
"Investors will keep a close eye on economic and earnings data in the coming months to assess the impact. This may not derail further upside for equity markets, but it means volatility will remain a fixture and the uncertainty about the tariff impact may cap the upside for equity markets for now and we could see some consolidation."
Tony Sycamore, market analyst IG, Sydney, said: "At this point, the reaction in markets has been modest, and I think part of the reason for that is the recent trade deals with the EU, Japan and South Korea have certainly helped to cushion the impact, as has Mexico being granted a 90-day reprieve. Trump said trade talks with China are doing reasonably well there.
"On top of all of that you have the Taco trade type situation whereby, after being obviously caught on the wrong foot in April, the market has probably taken the view the trade tariff levels can be renegotiated and can be walked lower over the course of time."
Illiana Jain, economist Westpac, Sydney, said: "The first thing to note is that we're not completely sure if these are the final rates for countries, or if they're subject to negotiations. When you're talking about that muted reaction from markets it's probably kind of wait-and-see, is this real? Are there going to be more negotiations?
"For the time being it looks like they will be in place. He did say a deadline of August 1, though I would be surprised if countries didn't work hard to kind of fight the rates."
Charu Chanan, chief investment strategist, Saxo, Singapore, said: "The tariff announcement brings clarity in form but not in function. We have a list of countries and their respective rates, but the logic behind the numbers is far from transparent. The sweeping nature of the measures suggests this isn’t a one-time fix but the beginning of a new global trade regime that favours unpredictability over structure.
"There are no real winners. The US administration can claim a political win, having followed through on its threats, but economically the impact will be felt in higher prices, disrupted supply chains and slower growth. Even countries that got away with 10% duties aren’t celebrating as they’re dealing with a fractured trade landscape and the volatility in frameworks.
"Defensive stocks or domestic-facing sectors might see some interest as capital rotates away from globally exposed companies, but this isn’t a thematic opportunity, it’s damage control."
Jeff Ng, head of Asia macro strategy, SMBC, Singapore, said: "The tariffs have come in relatively within expectations. I was expecting 20% to 30% tariff rates on average, so it looks like it's close to the lower end of the range.
"The dollar did strengthen over the past week or so and it looks like part of what has been priced into the trend.
"I expect the rates will continue to be changed between now and maybe up until next year. Trump will continue to make some changes to the tariffs."
Reuters
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.