Trump slaps steep new tariffs on India, Canada, others; markets reel

US President Donald Trump's latest wave of tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, sent global stock markets down on Friday as countries pushed for talks to clinch better deals. 

Trump's new tariff rates include a 35per cent duty on many goods from Canada, 50per cent for Brazil, 25per cent for India, 20per cent for Taiwan and 39 per cent for Switzerland. 

The presidential order listed higher import duty rates of 10per cent to 41per cent starting in seven days for 69 trading partners, effectively taking the US effective tariff rate to about 18per cent, from 2.3per cent last year, according to analysts at Capital Economics. 

 

Global shares stumbled, with the STOXX 600 down 1.3per cent at its lowest in a month. US stock index futures were down 1per cent, indicating a drop at the start of trade on Wall Street later. Futures tied to Canada's main stock index slipped. 

The market response was not as volatile as April's global asset declines, said Wei Yao, research head and chief economist in Asia at Societe Generale, referring to the market slide after Trump's initial tariffs announced on April 2. 

"We are all getting much more used to the idea of 15-20per cent tariffs being manageable and acceptable, thanks to the worse threats earlier," she said. 

But Trump's tariff rollout comes amid evidence they have begun driving up prices. 

US Commerce Department data released Thursday showed prices for home furnishings and durable household equipment jumped 1.3per cent in June, the biggest gain since March 2022. 

NO WINNERS? 

Countries hit with hefty tariffs said they will seek to negotiate with the US in hopes of getting a lower rate. 

Switzerland said it would push for a "negotiated solution" with the US 

"It’s a massive shock for the export industry and for the whole country. We are really stunned," said Jean-Philippe Kohl, deputy director of Swissmem, representing Switzerland's mechanical and electrical engineering industries. 

Taiwan President Lai Ching-te said the new 20per cent tariff rate for the island was "temporary" and that he expected to reach a lower figure. 

South Africa's Trade Minister Parks Tau said he was seeking "real, practical interventions" to defend jobs and the economy against the 30per cent US tariff it faces. 

Southeast Asian countries breathed a sigh of relief after the US tariffs on their exports that were lower than threatened and levelled the playing field with a rate of about 19per cent across the region's biggest economies. 

Thailand's finance minister said a reduction from 36per cent to 19per cent would help his country's economy. 

"It helps maintain Thailand's competitiveness on the global stage, boosts investor confidence and opens the door to economic growth, increased income and new opportunities," Pichai Chunhavajira said. 

Australian products could become more competitive in the US market, helping businesses boost exports, Trade Minister Don Farrell said, after Trump kept the minimum tariff rate of 10per cent for Australia. 

But businesses and analysts said the impact of Trump's new trade regime would not be positive for economic growth. 

"No real winners in trade conflicts," said Thomas Rupf, co-head Singapore and CIO Asia at VP Bank. "Despite some countries securing better terms, the overall impact is negative." 

"The tariffs hurt the Americans and they hurt us," winemaker Johannes Selbach said in Germany's Moselle Valley. 

"Thousands of families who produce wine in Europe and thousands of families in the importing, wholesaling, retailing, restaurant business in the US are dependent on the flow from both sides," he said, adding jobs and profits would be hit. 

Goods from all other countries not listed in Trump's executive orders will face a 10per cent US import tax. Trump had previously said that rate might be higher. The administration also teased that more trade deals were in the pipeline. 

CANADA, INDIA, CHINA 

The Republican president has tapped emergency powers, pressured foreign leaders, and pressed ahead with trade policies that sparked a market sell-off when they were first announced in April. 

Trump's order said some trading partners, "despite having engaged in negotiations, have offered terms that, in my judgment, do not sufficiently address imbalances in our trading relationship or have failed to align sufficiently with the United States on economic and national-security matters." Trump issued a separate order for Canada that raises the rate on Canadian goods subject to fentanyl-related tariffs to 35per cent, from 25per cent previously, saying Canada had "failed to cooperate" in curbing illicit narcotics flows into the US 

The higher tariffs on Canadian goods contrasted sharply with Trump's decision to grant Mexico a 90-day reprieve from higher tariffs of 30per cent on many goods to allow time to negotiate a broader trade pact. 

Canadian Prime Minister Mark Carney said he was disappointed by Trump's decision, and vowed to take action to protect Canadian jobs and diversify exports. 

India is in trade talks with the US after Washington imposed a 25per cent tariff on New Delhi, a move that could impact about $40 billion worth of its exports, an Indian government source with knowledge of the talks told Reuters on Friday. 

China is facing an August 12 deadline to reach a durable tariff agreement with Trump's administration. A US official told reporters that they are making progress toward a deal. 

The European Union struck an agreement on a blanket 15per cent tariff with the US at the end of July.