Asia Markets Slump as US Imposes Tariffs on Canada, Mexico, and China
Asia’s financial markets plummeted on Monday as the US announced tariffs on imports from Canada, Mexico, and China, sparking fears of a trade war that could slow global economic growth. The Nikkei in Tokyo and the Hang Seng in Hong Kong tumbled more than 2 and 1% respectively, while the KOSPI in Seoul fell over 2% at one point. The US dollar reached a record high against the Chinese yuan as a result.
The tariffs, announced over the weekend, will impose a 25% duty on most goods from Canada and a 10% tariff on Chinese imports into the US, with the measures set to take effect on Tuesday. The move is intended to combat the flow of migrants and fentanyl into the US.
Countries affected by the tariffs have already announced retaliatory measures, with Canada and Mexico announcing tariffs of their own and China vowing to challenge the US move at the World Trade Organization. The European Union is also in the crosshairs, with US President Donald Trump threatening to impose additional tariffs on imports from the region, claiming that the EU is “really out of line.” Trump is set to speak with Canadian Prime Minister Justin Trudeau on Monday to discuss the matter.
Market analysts warn that the surprise response from Canada and Mexico could lead to a sharp contraction in global trade, with some anticipating a “trade war” that could have far-reaching consequences for the global economy.
