SINGAPORE (Reuters) – U.S. President-elect Donald Trump said on Monday that on his first day in office he would impose a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China.
The announcement sparked a dollar rally. It rose 1% against the Canadian dollar and 2% against the Mexican peso, while U.S. stock futures and share markets in Asia fell. [FRX/][MKTS/GLOB]
KHOON GOH, HEAD OF ASIA RESEARCH, ANZ, SINGAPORE
“It looks like he’s not going to waste much time… so the question now is – on day 1 is he actually going to follow through with it and will the tariffs hit on day 1?
“The other interesting thing is he’s laid out his reasons for the tariffs (relating to the movement of people and drugs) so it looks like these tariffs are conditional on those. Whilst this is the opening salvo, maybe this is just the beginning of the deals he’s well known for.”
TONY SYCAMORE, MARKET ANALYST, IG MARKETS, SYDNEY
“I’m just trying to reconcile how it works with the appointment of Bessent. People have been expecting him to be a more moderate voice. Maybe it’s also a reaction to hey, look, everyone thought that Bessent was gonna moderate some of those more extreme trade policies … but Trump’s not gonna be moderated by anyone.
“He has said up to 60% on Chinese goods.. so if we’re only talking about an additional 10% tariff on Chinese goods on top of the existing levies, that’s a lot less than what he had previously indicated. .. so it may be actually less than the worst case scenario we were looking at.”
MATT SIMPSON, SENIOR MARKET ANALYST, CITY INDEX, BRISBANE
“It’s almost as if Trump wants to remind markets who is in control, after nominating Scott Bessent as Treasury Sec – a man markets expected to cool Trump’s potency. But with the Canadian dollar rising against the Mexican peso, markets are assuming this will hit Mexico the hardest.”
