Donald Trump Tariffs 2025
Two powers are set to hold a meeting regarding their trade agreement and negotiations. Talks will be held between the countries’ officials, following a call between Donald Trump, the US President, and Xi Jinping, the Chinese President, on Thursday, June 5, 2025. People in both countries are hoping for a good outcome between the two countries’ trade talks in the upcoming weeks. Donald commented by saying “The meeting should go very well”, as the Treasury, Commerce Secretary, and Trade Representative from the US will meet their counterparts in London on Monday.
Market Reaction on Trump Tariffs 2025
Opening trade was seen with good highs in Dow Jones, S&P 500, and Nasdaq but were down by coming near to the end of the day, as investor feared for potential trade war widening or not reaching any goal of both countries. At one point S&P reached the 6000 mark but it failed to maintain after which everyone saw a fall.
International Response
China immediately responded by promising to make reciprocal tariffs on United States exports to China and also cited, that they will do anything to protect their economy in any condition. After China, European Union leaders criticized the move by Donald Trump’s 2025 tariff and will also impose reciprocal tariffs on US goods. Neighbouring Mexico warned that because of a trade war, agricultural and automotive industries will take a hit which is two top exports to the US from Mexico. While World Trade Organization (WTO) was urging all the parties mainly the United States to go into dialogue instead of any aggressive policies which led the world into recession. Turkey and India in some parts are filling the gap for some trade void because of disputes between the US and China.
Economic implications
If tariffs come into effect then the cost of goods will increase which leads to higher spending by the common public and they won’t have any other option to buy if they don’t have any choice. Global and even local companies will see a service disruption in the supply chain before both importing and exporting will be in a state of a trade war with each other and we know the United States will be one of them. This will also create a rise in inflation because of higher import prices. Companies’ balance sheets will see a decline in their profit margin and if the company is public then investors will lose their wealth in the form of a stock value decrease or staying steady at the same price for longer. Smaller or developing countries will try to devaluate to offset trade disadvantages. Small companies in the US which were relying on cheap imports from China will have a major impact or even make them hard to sustain in the market, if a company fails to perform then this will have a direct impact on the job market.
Political Commentary
One of the early commentators was Donald Trump’s newly turned critic which is no other than Elon Musk, he criticized Trump’s trade policies, and aggressive tariffs might or will lead the country into a recession by the second half of 2025 and after. Donald Trump and Elon Musk are also engaged in their browal which you can follow here Donald Trump VS Elon Musk. Countries around the world that were close allies are thinking twice before saying the United States as their friend after the tariff, on the other side International Monetary Fund (IMF) claimed if the trade war stayed longer then it would wipe out 1% of global GDP growth. No response has been seen from former US president Joe Biden but their party will be the first to oppose Donald Trump’s plan in the future.
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