Asian markets fluctuated on Monday as traders prepared for potential tariffs from the White House next week. The action, which many fear could impact the global economy, is set to begin on April 2. A report suggested that US President Donald Trump was considering a more targeted approach to the levies.
However, this did little to ease investors’ concerns, with uncertainty continuing to weigh on confidence. Since taking office in January, Trump has caused concern across markets by criticizing long-standing allies and threatening substantial tariffs on a wide range of imports. Next Wednesday, dubbed “Liberation Day” by Trump, is now the focus, with expectations of reciprocal measures from other countries.
“Anticipation and pre-positioning ahead of Trump’s ‘Liberation Day’ on April 2 and the impending wave of tariff-related announcements will be a significant factor driving price action, sentiment, and liquidity in markets this week,” said Chris Weston at Pepperstone. The Federal Reserve last week warned that “uncertainty around the economic outlook has increased.” This reflects concerns echoed by the central banks of Japan and Britain about the impact of White House policies.
Markets react to tariff uncertainty
Chinese Premier Li Qiang stated over the weekend that Beijing is readying for “shocks that exceed expectations.” He noted that “instability and uncertainty are on the upswing.” His comments were made during meetings with executives from some of the world’s largest companies. Australian Treasurer Jim Chalmers told Bloomberg News that Trump’s moves “are not surprising, but they are seismic.” Bloomberg reported that the US administration might take a more targeted approach to tariffs, potentially hitting some countries harder than others. Trump assured reporters on Friday that there “will be flexibility” in his plans.
Despite these assurances, Asian markets saw mixed reactions as the week began. Tokyo was flat, while Shanghai, Singapore, and Taipei experienced slight gains. In contrast, Hong Kong, Sydney, Seoul, and Wellington saw minor declines.
Gold remained steady around $3,025, after setting record highs last week due to increased demand for safe havens. As investors navigate a period of heightened uncertainty, market movements in the coming days will be closely monitored.
