SINGAPORE (Reuters) – US President-elect Donald Trump said on Monday that on his first day in office he would impose a 25% tariff on all imports from Mexico and Canada, and an additional 10% tariff on imports from China.
The announcement raised the dollar. It rose 1% against the Canadian dollar and 2% against the Mexican peso, while stock markets in Asia fell, as did European equity futures. S&P 500 futures fell 0.3%.[FRX/][MKTS/GLOB]
Here are the reviews from those in the market:
NAKA MATSUZAWA, CHIEF MACRO STRATEGIST, NOMURA, TOKYO
“Ten percent (in China) is not as big as he was talking about, 60%. But it still came in concrete form, so I think the initial reaction was not good.
“If this stays at 10 percent, it would not be bad for the Chinese economy and maybe less for the (economy) of the world.”
GARY NG, CHIEF ECONOMIC, NATIXIS, HONG KONG
“That will shock the market and burden China’s assets, especially the foreign sectors because their corporate profits will be squeezed by these increased tariffs.
“But compared to what he put in Canada and Mexico, the size is not big, so the investors may still want to see what is next and if / if the 60% promised will come.”
SIMON YU, VICE GENERAL MANAGER, PANYAO ASSET MANAGEMENT, SHANGHAI
“Tariffs are Trump’s trump card in negotiations with other countries.
“China already has a template for dealing with tariffs according to Trump 1.0. With regard to other measures such as sanctions related to tech, China can quickly become independent and retaliate abroad.”
GEORGE BOUBOURAS, HEAD OF RESEARCH, K2 ASSET MANAGEMENT, MELBOURNE
“It is important to point out that the 25% tariffs with China, Mexico and Canada have not yet become laws but it is a good sign that under the Trump administration they will no longer tolerate the transfer of manufacturing from China to US NAFTA partners with Chinese companies. .
“Such headlines will continue to support a very high yield and a strong USD… as always when it comes to trade, currency or currency changes, there will be ups and downs.”
WILLIAM REINSCH, SENIOR ADVISOR, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES:
“This strikes me as more of a threat than anything else.
“I guess if you keep hitting them in the face, they will eventually give up.”
“It didn’t work with China, and I don’t think it will work with Mexico and Canada.”
SHOKI OMORI, CHIEF JAPAN DESK STATEGIST, MIZUHO SECURITIES, TOKYO
“At first the reaction on CAD, MXN, etc seems to be big, but MXN seems to be stable because it already fell against the dollar when Trump was elected.
“MXN is favored by commodity traders, so I feel that MXN will be bought by dip buyers if Trump does not go ahead.
“The mistake from Bessent is too much. Even if he tries to control the mistake, Trump ultimately has too much power.”
JASON WONG, SENIOR MARKET STATEGIST, BNZ, WELLINGTON
“It seems like we’ve just gone back to 2016 and the market is back to responding to tweets.
“It will take time, and this is the new culture. The market will be worried, and it is ahead of the mind, but this is how it works… for anything at the moment so the market just wants to catch you can’t read too much into these things.
ROB CARNELL, HEAD OF RESEARCH, ING, SINGAPORE
“It reminds me of four years ago, when you would wake up every morning and the markets would be hit by whatever the latest statement was. I’m tempted to take it with a grain of salt. He’s not the president anyway.
“This is how he does things, isn’t it? He throws things around, he says different numbers, the market works and maybe it happens and maybe it doesn’t.”
ALEX LOO, FX AND MACRO STRATEGIST, TD SECURITIES, SINGAPORE
“Although the USMCA agreement is in the process of being renegotiated in 2026, Mr. Trump may try to start an early reform process with Canada and Mexico through today’s tariff announcements. MXN and CAD had a weak decline outside North America during the period. They contributed to the movement seen in Asia this morning.”
SEAN CALLOW, SENIOR FX ANALYST, ITC MARKETS, SYDNEY
“It was only last month that Trump said that “the best word in the dictionary is tariff, so there should be no surprise in Trump’s intention, during the speech.
“The fall in trade finance makes sense and should continue given the quiet calendar, but Fed policy should come back to the fore as we get closer to the December FOMC meeting.”
KHOON GOH, HEAD OF ASIA RESEARCH, ANZ, SINGAPORE
“It looks like he’s not going to spend much time… so the question now is – on day one will he really comply and will the tariff come on day one?
“One interesting thing is that he has stated his reasons for the taxes (related to the movement of people and drugs) so it seems that these taxes have provisions on that. But this is the first salvo, maybe this is just the beginning of the law. The deals he is known for.”
TONY SYCAMORE, MARKET ANALYST, IG MARKETS, SYDNEY
“I’m just trying to reconcile how it works with the appointment of Bessent. People were expecting him to be a moderate voice. Maybe that’s also the reaction to hey, look, everyone thought that Bessent would fix some of the more extreme trade laws… but Trump is not going to be fixed by everyone.
“He said that Chinese goods are up to 60%… so if we are only talking about adding 10% of tariffs on Chinese goods on top of the existing tariffs, it is less than what he had previously indicated… so it may be less than the worst situation we saw.”
MATT SIMPSON, SENIOR MARKET ANALYST, CITY INDEX, BRISBANE
“It seems that Trump wants to remind the markets who is in control, after choosing Scott Bessent as Treasury Sec – a man markets expected to cool the power of Trump. But with the Canadian dollar rising above the Mexican peso, the markets are thinking that this will hit Mexico. very hard.”
(Reporting by Reuters’ Asia markets team in Sydney, Shanghai, Singapore, Hong Kong and Tokyo and Andrea Shalal in Washington. Writing by Tom Westbrook; Editing by Neil Fullick)
