Washington – President Trump’s decision to hike the prices on some of the biggest trade partners in America rocked the markets on Monday, hoping for the hopes of Wall Street that the White House would reduce significant trade agreements, as promised, in the middle of this week.
In a series of letters sent to foreign leaders and quickly published by the president on his social media platform, Trump said that the new rates equivalent to the cost of doing business with “the extraordinary economy of the United States, the number one market in the world, by far”. Under the new policy, Japan, South Korea, Malaysia and Kazakhstan will face 25% import rights from August 1, while the goods of Cambodia and Thailand are set at 36%. Laos and Myanmar will face a rate of 40%, depending on the letters.
Indonesia faces a 32%task. Bangladesh and Serbia have been informed that their goods will face 35% of import rates, while goods from South Africa and Bosnia and Herzegovina sent to the United States would be confronted at 30%.
“It is a great honor for me to send you this letter in that it demonstrates the strength and commitment of our commercial relationship,” wrote Trump in letters, sending the same text to each foreign leader.
The markets were fell to news, the industrial average of Dow Jones fell by 1.4%, the Nasdaq down 1.2%and the 500 of Standard & Poor’s 500 1.2%.
This decision essentially refers the American tariff rates to these countries to those that Trump announced for the first time on April 2, on what he called the Liberation Day, but that he finally abandoned the generalized panic of Wall Street which began to frighten the bond market.
Trump paused on the crisis by announcing a 90 -day suspension of higher rate rates, a period that expires on Wednesday. But the White House press secretary Karoline Leavitt said on Monday that Trump would extend the deadline until the end of the month.
Several senior senior administration officials promised that a multitude of commercial transactions would follow the April episode – “we are going to conclude 90 agreements in 90 days,” said Peter Navarro, the president’s best sales advisor. However, the administration failed to conclude a single detailed trade agreement, announcing three executives of understanding with the United Kingdom, China and Vietnam rather.
“The president adopts a very deliberate approach to correct this evil of several decades, many previous presidents – I think he should be congratulated for the time and the effort he devotes,” Leavitt told journalists during a press briefing.
“The fact that he announced a framework with China, a trade agreement with the United Kingdom, a trade agreement with Vietnam and many others to come in just six months is really historic, and this testifies to this president and his sales team,” she added.
In his letters to foreign leaders, Trump warned that any effort of their governments to retaliate would meet with an escalation.
“If, for any reason, you decide to increase your prices, then, whatever the number you choose to raise them, will be added to the 25% that we will charge,” he wrote.
Leavitt said other letters would be sent in the coming days. She also said that additional commercial transactions could be announced soon. “We are close,” she said.
In a separate article on his Truth social platform, Trump warned that the countries of the BRICS – an economic partnership including Brazil, Russia, India, China, South Africa, Saudi Arabia, Egypt, the United Arab Emirates, Ethiopia, Indonesia and Iran – would face an additional 10% price.
“There will be no exceptions to this policy,” wrote the president.
Scott Bessent, the secretary of the Treasury, told CNBC in an interview that his reception box was “complete last night with a lot of new offers” for commercial transactions before the deadline of Wednesday now disappeared.
“We had a lot of people to change their melody in terms of negotiations,” said Bessent. “So it’s going to be busy days.”
The reaction of the stock market market at the Trump release day, which increased rates in countries around the world, was a historic rout, avoiding billions of dollars of value, with the standard & poor index raising 12% in just four days.
The markets recovered in a few weeks, after Trump reversed the course, the S&P reaching a record on Thursday.
