On April 2, U.S. President Donald Trump is set to announce new customs tariffs against multiple countries, including Japan, China, Canada, and the European Union, heightening international trade tensions.
New U.S. Tariffs and Their International Impacts
The decision to implement new tariffs underscores the aggressive stance of the U.S. in trade policies. Contrary to expectations, this has led to stronger ties among other countries, with China, Japan, and South Korea meeting to bolster regional trade cooperation, indicating potential alliance consolidation in response to isolation policies.
Fed's Stance Amid Economic Uncertainty
The Federal Reserve is considering a 2.5 basis point rate cut this year but faces economic uncertainty. New tariffs could exacerbate inflationary pressures, heightening the likelihood of a second-quarter recession. In this stagflation environment, the Fed is likely to adopt a 'wait and see' approach.
Cryptocurrency Market's Response to Uncertainty
Global economic uncertainty adversely affects the cryptocurrency market, impacting Bitcoin and Ethereum. The market has shown weak performance, and a significant recovery is not anticipated by investors until a major favorable development occurs.
New tariffs and economic uncertainty continue to pressure global markets and the cryptocurrency market, which may persist until the global economic outlook improves.
