Asian markets have slumped and European and US equity futures pointed sharply lower after Donald Trump’s tariffs on Canada, Mexico and China triggered fears of a broad trade war.
The US dollar shot to a record peak against the Chinese yuan in offshore trading, its highest against Canada’s currency since 2003 and the strongest against the Mexican peso since 2022.
Japan’s Nikkei opened down 2% this morning, with large falls also reported on Taiwan and South Korea’s indices.
And stocks in Hong Kong, which include listings of Chinese companies, fell 1.1% upon reopening from Lunar New Year holidays.
Pan-European STOXX 50 futures sank 2.7%, and U.S. S&P 500 futures dropped 2%.
Earlier on Sunday, Trump said any potential pain caused by the trade war would be worth it.
It came after he slapped Canada and Mexico with duties of 25% and China with a 10% levy at the weekend, calling them necessary to combat the flow of migrants and fentanyl into the US.
Canada and Mexico immediately vowed retaliatory measures, and China said it would challenge Trump’s levies at the World Trade Organisation.
