The new protectionist measures announced by President Donald Trump have caused a tumultuous reaction in global financial markets, impacting both investors and economies of other countries.
Announcement of Tariffs and Their Consequences
On April 2, 2025, Trump delivered a speech from the White House announcing a base tariff of 10% for all trading partners of the United States. Some countries face even higher rates: 20% for the European Union, 34% for China, 46% for Vietnam, and 24% for Japan.
These measures also include tariffs of 25% on automotive imports, leading to significant upheaval in financial markets. European stock indices opened sharply lower, with the STOXX Europe 600 index losing about 1.8%. The German DAX index was particularly hit. Companies like Pandora, Adidas, and Puma saw their stocks drop by 10%, while heavy industry giants like Siemens and ThyssenKrupp lost 4% and 3.4%, respectively.
In the United States, the tech sector faced severe backlash, with Apple falling more than 6% post-announcement, dragging down other giants like Nvidia (-4%), Tesla (-4.5%), Alphabet, Amazon, and Meta (between -2.5% and -5%).
International Community's Reaction
International reactions to Trump's decision have been swift. The European Union quickly expressed its intention to take countermeasures if negotiations fail. Ursula von der Leyen, President of the European Commission, called Trump's decision a 'serious blow' to the global economy, lamenting the 'chaos and complexity' created by these measures.
The United Kingdom, affected by a 10% tariff, opted for diplomacy. Jonathan Reynolds, Secretary of State for Business, stated that 'no one wants a trade war,' while clarifying that 'nothing is excluded' to defend British interests.
China, facing the highest rate, reacted strongly, urging the United States to cancel these measures and promising to 'resolutely take countermeasures.' According to the Chinese Ministry of Commerce, these tariffs 'violate the rules of international trade' and represent 'a typical unilateral intimidation act.'
Long-term Consequences for Global Economy
Trump's protectionist measures threaten the global economy in the long term. According to Olu Sonola from Fitch Ratings, 'This is a radical change for the global economy' that could plunge 'many countries into recession' if these tariffs persist. Ryan Lee from Bitget Research explains, 'Trump’s unexpectedly severe tariffs have triggered a massive sell-off,' which also affected the cryptocurrency market, with ETH and SOL dropping by about 6%. The coming days will be crucial to assess the repercussions of this aggressive trade policy on financial markets and the global economy.
The announced tariffs may have deep consequences for both the global economy and financial markets. Countries facing mounting tensions will be compelled to respond swiftly to the new economic landscape.
