US President Donald Trump has imposed 25% tariffs on imports from Canada and Mexico, while China will retaliate with 10-15% tariffs on certain US agricultural goods. The move sparked fears of a full-blown trade war.
Global stock markets plummeted as the news spread, with the Dow Jones closing 1.5% lower and the S&P 500 ending the day down 1.8%. The FTSE 100 index in the UK also fell sharply, while Asian markets were down due to concerns about retaliatory measures from China and Canada.
Analysts warn that tariffs could push up prices for US households and have a knock-on effect on consumers worldwide. The International Chamber of Commerce says the move marks a “biggest effective increase” in US tariffs since the 1940s, with severe economic risks attached.
Canada’s Prime Minister Justin Trudeau vowed to retaliate with 25% tariffs on $150bn worth of US goods, while China has announced its own countermeasures. The US claims the tariffs will boost manufacturing and protect jobs, but experts say such measures can harm consumers and businesses.
The global economy is heavily integrated, with billions of dollars’ worth of goods crossing borders each day. Companies may pass on extra costs to consumers or reduce imports, leading to fewer products and higher prices. Analysts predict US households could see a $2,000 increase in costs this year alone.
Global trade experts warn that the move marks a “huge challenge” for businesses with historical links between the US and Europe. Despite this, there is hope for a stronger UK-China relationship.
Source: https://www.bbc.com/news/articles/ckg1jxdpq0qo