As Trump Promises Much Higher Tariffs, Dollar Gains – Asia Market Wrap
The Dollar rose when Trump stated that he wanted ‘much bigger’ uniform tariffs. Most Asian stocks declined as concerns about high valuations in the AI sector persisted for a second day.
The Dollar surged against all of its Group-of-10 counterparts after the president indicated he wants considerably higher across-the-board tariffs than the 2.5% proposed by new Treasury Secretary Bessent, adding to indications that he is considering extensive taxes to boost the US supply chain. Trump also stated that he would soon impose taxes on foreign-produced semiconductors, pharmaceuticals, and some metals to compel businesses to manufacture in the country.
The MSCI Asia Pacific Index fell 0.6%, with Japan’s leading technology businesses among the hardest hit. That came as US markets fell on Monday as a low-cost AI model from Chinese startup DeepSeek raised concerns about inflated valuations. Many Asian markets, including China, South Korea, and Taiwan, are closed for the Lunar New Year vacation.
Copper prices fell after Trump announced plans to put import taxes on the metal, as well as aluminium and steel, stoking concerns about trade conflicts.