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Stock markets around the world tumbled on Thursday, the dollar sank and oil prices plunged after Donald Trump’s new global tariffs raised fears of a US recession.
Wall Street experienced its worst day since the pandemic in 2020, with a sell-off in equities wiping more than $2 trillion off America’s most valuable companies in the aftermath of what the US president called “liberation day”.
Mr Trump announced minimum tariffs of 10pc on all imports from around the world, with additional levies on dozens of other countries reaching as high as 50pc. The president argued the tariffs would help make the US rich.
However, rating agency Fitch said the trade policies were “significantly raising US recession risks.” World leaders signalled they would respond to Mr Trump’s tariffs with levies of their own, suggesting a global trade war that would leave the world poorer.
The US dollar fell by 1.7pc against a basket of currencies, adding to speculation that its days as a safe-haven currency could be numbered. Recession fears also drove down the oil price by 6.7pc, amid concerns that a slowdown in the world’s largest economy would dampen demand.
Mr Trump insisted the US economy was “healing” after his drastic action. He said on Truth Social: “The operation is over! The patient lived and is healing. The prognosis is that the patient will be far stronger, bigger, better and more resilient than ever before.”
Speaking to reporters at the White House, Mr Trump said: “I think it’s going very well.”
“The markets are going to boom,” he said, adding: “The country is going to boom.”
Vice President JD Vance also insisted during a Fox News interview that there was nothing but “enthusiasm” for Mr Trump’s aggressive trade policies.
There was little enthusiasm on show on Wall Street, where the the S&P 500 fell 4.8pc. The tech-heavy Nasdaq index, home to giants like Apple, Nvidia and Microsoft, lost 6pc.
Apple lost more than $250bn in market value after shares in the iPhone-maker fell by more than 9pc, the worst day since the start of the pandemic.
American banks were also swept up in the sell-off despite not being directly exposed to tariffs, with Citigroup down 12pc and Bank of America 11pc.
Mr Trump has now presided over the worst 10-week start to a presidency as measured by stock market performance since George Bush and the dot-com crisis in 2001.
The rout hit stocks from Tokyo to London, as affronted American trade partners vowed to fight back.
However, in another sign of a Brexit dividend, the sell-off in London was only half as bad as similar slumps in Europe. The FTSE 100 suffered a 1.6pc fall. The German Dax was down 3pc and French stocks on the Cac 40 fell 3.3pc.
The differing scale of the slumps reflects the difference in tariffs. President Trump hit the EU with levies of 20pc on all goods sold to the US, but put a 10pc levy on British imports.
Emmanuel Macron branded the move “brutal and unfounded”, while Italy’s Giorgia Meloni said it was “wrong” and EU chief Ursula von der Leyen warned she was “prepared to respond”.
Economists and traders warned that the tariffs would lead to lower global growth and push America’s economy into recession.
The world economy will be 2pc smaller than it otherwise would be by 2027 as a result of the tariffs, The National Institute of Economic and Social Research said.
Libby Cantrill from US bond giant Pimco, which manages $2 trillion of assets, said: “Anyone who may have doubted Trump’s seriousness about rebalancing the economy through tariffs and his deeply held belief that tariffs work, should be convinced by now.
“We should expect to see economic damage both in terms of a drag on growth, maybe even tipping into recession, and upward pressure on inflation.”
Luca Paolini from Pictet Asset Management said: “We now rate the probability of a US recession at 50pc or higher — significantly more than we anticipated just a few months ago. Given the heightened risk of a US recession, we believe it is prudent to reduce risk.”
British stocks could emerge in a relatively stronger position than many rivals, Mr Paolini added.
He said: “The UK, for its part, will be subject to a more modest tariff of 10pc. This and the fact that its equity market offers high dividend yields and relatively high exposure to commodities and defensive sectors, indicate UK stocks could fare better than most.”
Read the latest updates below.
10:52 PM BST
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10:42 PM BST
Tariffs will ‘make our county very rich’, claims Trump
Donald Trump defended his trade policies in a conversation with reporters aboard Air Force One this evening. He said that the reaction of the markets were “what is expected.”
“The economy had a lot of problems,” he said. “It was a sick patient. It went through an operation. It’s going to be a booming economy. It’s going to be amazing. We’re going to have trillions coming in.”
Asked about the hike in tariffs, he said: “It’s going to make our county very rich.”
He also said that tariffs on pharmaceuticals, which were excluded from his big announcement this week, are coming.
Pharmaceutical manufacturing “is going to start coming in, I think, at a level that we haven’t really seen before,” he said. “We are looking at pharma right now. Pharmaceuticals. It’s a separate category. We’ll be announcing that sometime in the near future. It’s under review right now.”
He also said that his approach had put America “in the driver’s seat”.
He said: “Every country is calling us. That’s the beauty of what we do. We put ourselves in the drivers seat - if we would have asked these countries to do us a favour, they would have said no. Now they will do anything for us.”
10:27 PM BST
Tariff plans help China and Russia, claims ex-Trump spokesman
Anthony Scaramucci, who was Donald Trump’s communications chief for 11 days in his first term and is now a vocal critic, has hit out at Mr Trump’s trade war.
He wrote on social media platform X that the tariffs would advantage China and Russia while damaging the US.
Earlier, he made fun of the imposition of tariffs on all exports from the Heard and McDonald Islands, a barren sub-Antarctic Australian territory without a human population, but four different species of penguin.
“The penguins have been ripping us off for years,” he said.
Chuck Schumer, the US Senate Democratic leader, wrote: “Donald Trump slapped tariffs on penguins and not on Putin,” referring to the fact that Russia was not on the US tariff list.
10:06 PM BST
Traders bet bigger on Fed rate cuts
Traders are ramping up expectations for the US Federal Reserve to cut interest rates as tariffs are poised to unsettle the world’s largest economy.
George Bory, chief investment strategist at Allspring Global Investments, said: “The Fed does have considerable firepower to help the market.
“The market is now pricing in more rate cuts, and perhaps sooner.”
He added that a cut in June now seemed guaranteed, with the chance of a cut in May as well.
That heightens the significance of tomorrow afternoon’s new payrolls figures and an expected speech by US Fed chairman Jerome Powell, which could offer crucial insights into the American economy’s health and the future path of interest rates.
10:01 PM BST
UK ‘happy’ about tariff treatment, says Trump
Donald Trump has said that the UK is “happy” about its treatment over tariffs, Reuters has reported.
It comes as Sir Keir Starmer’s administration is keen to secure a post-Brexit trade deal with Washington.
Jonathan Reynolds, the Business Secretary, said: “I recognise the announcements by the President last night put the UK in a relatively better position than, for instance, the EU.”
09:58 PM BST
Trump open to ‘phenomenal’ offers from other countries
Donald Trump has said that he would be willing to discuss cutting tariffs if other nations offer something “phenomenal”.
He made the remark to reporters on Air Force One, according to Bloomberg.
09:07 PM BST
Wall Street ends with heavy losses on fears Trump tariffs will trigger recession
Wall Street main indexes ending trading this evening with the largest one-day percentage losses in years, as Donald Trump’s sweeping tariffs ignited fears of an all-out trade war and a global recession.
The tariffs, poised to disrupt the global trade order, highlight a stark shift from just a few months ago when the promise of business-friendly policies under the Trump administration propelled US stocks upwards.
China vowed retaliation, as did the European Union. South Korea, Mexico, India and several other trading partners said they would hold off for now as they seek concessions.
The coming days are expected to be volatile, as events unfold and the full effect of Trump’s economic actions start to feed through into the wider economy. The Vix, known as Wall Street’s fear gauge, touched a three-week high.
“There are still a lot more questions than answers out here,” said Steven DeSanctis at Jefferies Financial Group.
The S&P 500 lost 4.8pc, while the Nasdaq dropped 6pc. The Dow Jones Industrial Average fell 4pc.
High-flying technology stocks suffered big declines after pushing Wall Street to record highs in recent years.
Apple sank, reeling from an collective 54pc tariff on China, the base for much of the iPhone maker’s manufacturing. Nvidia slumped, as did Amazon.
09:01 PM BST
US rate-setter warns over higher inflation and lower growth
One of the US Fed’s rate setters has suggested she is more pessimistic about the American economy, a day after Donald Trump hiked the cost of imported goods.
Lisa Cook said: “I currently place more weight on scenarios where risks are skewed to the upside for inflation and to the downside for growth.
“Such scenarios, with higher initial inflation and slower growth, could pose challenges for monetary policy.”
She added: “I could imagine scenarios where rates could be held at current levels longer or eased faster based on the evolution of inflation and unemployment. For now, we can afford to be patient but attentive.”
The central banker said: “I am carefully watching various channels through which tariff effects could have more widespread implications for prices.”
08:45 PM BST
Hassett says no need to worry about China cutting off pharmaceutical supplies
A key economic adviser to President Donald Trump has dismissed the possibility of China retaliating to tariffs imposed this week by cutting off supplies of drugs.
Kevin Hassett was asked on Fox News if he had any concern that China stop exporting pharmaceuticals as a result of 34pc tariffs on Chinese goods announced on Wednesday.
“There are lots of other places to get pharmaceuticals. The problem is there aren’t a lot of pharmaceutical plants here in the US and that’s why we have this policy to fix that,” Mr Hassett said. “And so I don’t think people need to be worried about that and I don’t think that they would do that.”
08:36 PM BST
Tech giants slump as Trump slices into their profits
Tech giants have suffered major plunges on Wall Street today. Apple’s 9.6pc drop was the biggest weight on the S&P 500. More than 90pc of its manufacturing is based in China, one of the hardest-hit countries by the tariffs, according to an estimate from Citi.
Rosenblatt Securities estimated the iPhone maker could face $39.5bn (£30.2bn) of tariff costs, adding that “if these costs were just eaten by Apple, we estimate a near 32pc hit to operating profit and EPS [earnings per share], annualised.”
Makers of PCs and AI servers will be hit hard as well. The US imported nearly $486bn in electronics last year, the second-biggest sector for imports, after machinery, according to US Census Bureau data.
PC makers, including Dell and HP, could face cost increases of about 10pc to 25pc, adding between $200 and $500 in costs per unit, said Tony Redondo, founder of Cosmos Currency Exchange.
That would squeeze margins at the companies, or force them to raise prices, potentially dealing yet another blow to personal computer demand that has already been choppy in recent years. Shares of Dell dropped 18.7pc, while HP slumped 14.3pc.
The tariffs would make artificial intelligence servers pricier too, potentially adding millions in extra costs and upending AI development plans among big tech firms.
08:16 PM BST
Mexican president welcomes being left off Trump’s tariffs list
President Claudia Sheinbaum of Mexico told reporters that Mexico was spared new “reciprocal” tariffs thanks to her government’s “good relationship” with the US administration.
Mexico’s economy is considered one of the most vulnerable to Mr Trump’s tariffs due to its close trade relations with the United States and their joint membership of the US-Mexico-Canada Agreement (USMCA) on free trade.
More than 80pc of Mexican exports go to the United States, including about three million vehicles a year.
The Latin American nation is home to many foreign-owned vehicle assembly plants operated by companies including Ford, General Motors, BMW, Volkswagen and Toyota.
Trump has slapped a 25pc import tariff on foreign-made cars and light trucks, though with some exceptions for USMCA-covered vehicles and parts.
The move prompted multinational car company Stellantis, which has plants in the Mexican cities of Toluca and Saltillo, to announce it is pausing production in Mexico, where it makes Dodge cars and Ram trucks.
Mexico’s Economy Secretary Marcelo Ebrard said the USMCA remained intact, which he described as a “major achievement.”
He said Mexico would, in the next 40 days, seek “the best conditions” for bilateral trade in automobiles, steel and aluminum.
“We must always be thankful for the willingness of the President of the United States to engage in dialogue with respect to our country,” Ms Sheinbaum told business leaders.
07:58 PM BST
US tariffs could shrink trade volumes by 1pc this year
Donald Trump’s worldwide tariff salvo could lead to an overall contraction of around 1pc in goods volumes being traded globally this year, the WTO chief warned Thursday.
After Trump on Wednesday unveiled a blitz of harsher-than-expected levies aimed at countries around the globe, Ngozi Okonjo-Iweala warned the measures would “have substantial implications for global trade and economic growth prospects”.
“While the situation is rapidly evolving, our initial estimates suggest that these measures, coupled with those introduced since the beginning of the year, could lead to an overall contraction of around 1pc in global merchandise trade volumes this year,” the World Trade Organisation director-general said.
This, she said, would represent a drop of nearly four percentage points from the WTO’s previous projection.
Ms Okonjo-Iweala urged WTO members to manage the tensions resulting the US measures responsibly.
“I’m deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade.”
07:54 PM BST
Trump’s competition tsar warns over price rises
Donald Trump competition tsar has warned that regulators will be watching checking that companies are “vigorously competing on prices”.
Andrew Ferguson, chairman of the Federal Trade Commission, made the remarks a day after Donald Trump imposed price rises on imported goods.
07:50 PM BST
Trump says stocks will ‘boom’ despite Wall Street sell-off
Donald Trump has insisted that stocks and the US economy will thrive despite a rout on global markets sparked by his worldwide tariffs.
“I think it’s going very well,” Mr Trump said.
The United States will “have six or seven trillion dollars coming into our country.”
“The markets are going to boom,” and “the country is going to boom,” Mr Trump said. He added that other counties “have taken advantage of us for many, many years.”
07:48 PM BST
China ‘fully prepared psychologically’ for trade war, says state-owned investment group
China is “fully prepared psychologically” for Donald Trump’s tariffs, an investment group owned by the Chinese government has said.
Wang Zhuo, a partner at Zhouzhi Investment in Shanghai, said: “Trump’s new tariff measures are undoubtedly unwise, as fair trade is not realised through so-called reciprocal taxes, but is determined by comparative advantage [an economic theory that suggests countries should focus on producing what they are best at and import the rest].
“The higher tariffs will dent US efforts to reduce inflation, so it’s possible the US will witness stagflation. The slump in US stocks is a sign that investors are voting with their feet.
“The Chinese market is fully prepared psychologically, so is resilient. What’s more important for China now, is to pay attention to domestic macro policies and data, and see when our CPI data can improve and whether it’s sustainable.”
07:33 PM BST
Wall Street sinks as big tech engulfed by bloodbath
US stocks sank today, with the bloodbath engulfing big tech names and small companies alike.
Investors fled from risky assets, seeking the safety of government bonds, after Donald Trump unveiled the details of his flagship trade policy last night.
The tariffs, poised to disrupt the global trade order, highlight a stark shift from just a few months ago when the promise of business-friendly policies under the Trump administration propelled US stocks to record highs.
The Nasdaq, which is heavily focussed on tech stocks, is down 5.6pc, while the S&P 500 is down 4.4pc.
Tech firms big fallers. Apple is down 9.4pc, Amazon is down 8.5pc, Tesla has lost 5.6pc and Nvidia has dropped 7pc.
07:27 PM BST
Summers likens Trump’s tariffs to creationism
Larry Summers, who was US treasury secretary under Bill Clinton, has compared Donald Trump’s new tariffs “is to economics what creationism is to biology”.
He claimed that the Trump administration “computed reciprocal tariffs without using tariff data”.
He added: “If any administration of which I was a part had launched an economic policy so totally ungrounded in serious analysis or so dangerous and damaging, I would have resigned in protest.”
07:16 PM BST
‘Everyone worried’ by Trump tariffs in France’s Champagne region
France’s champagne industry has warned that Donald Trump’s tariffs “puts in danger our presence on the American market”.
Maxime Toubart, co-president of the Comite Champagne trade association, said “the entire industry is mobilised against this tax” which risks the economic viability of the sector and the Champagne region.
The trade group said champagne is “a key element of the French economy” with nearly €6bn (£5.1bn) in annual sales.
Nearly 30 million bottles of champagne worth €810m were exported to the United States last year.
“We’re all worried about the decisions made by the American president,” said David Chatillon, a co-president of the Comite Champagne.
Mr Trump’s use of the word of reciprocal in describing the measures “can lead one to think that there’s hope and room for negotiation,” said Vitalie Taittinger, who heads up her family’s namesake champagne house.
06:59 PM BST
Italian PM says Trump tariffs a mistake, but no catastrophe
Giorgia Meloni, the Italian prime minister, has said that trade tariffs announced by the United States were a mistake but that their impact should not be overestimated.
“We must not fuel alarmism, it’s not a catastrophe,” Ms Meloni said in an interview on Italian state television station RAI.
“I’m not convinced that the best way to respond to tariffs is with other tariffs,” she added.
06:57 PM BST
UK can still increase trade with US, says Lord Mayor of London
Donald Trump’s decision to impose only a 10pc tariff on the UK last night shows the “strength of the relationship between the two countries”, the Lord Mayor of the City of London has said.
Alastair King told Bloomberg Television that there is an opportunity for Britain to increase its trade with America, especially in finance.
“Tariffs are regrettable and we’re sad to see them imposed,” he said. “This is a bump in the road, but I think there will be great opportunities still to grow.”
06:47 PM BST
Little support for tariffs on US services, says Irish premier
There is a lack of “widespread” support for EU tariffs on American services, the Irish prime minister has said, even though some bigger states are advocating them.
Micheal Martin told Irish broadcaster RTE that he some of the larger EU member states may be pursuing for them “as a sort of nuclear option on day one”.
The Irish government, he said, was against such tariffs, particularly as an initial response.
He added that the lack of Trump tariffs on EU pharmaceuticals so far may be because of the complexity of the industry.
Asked if he believed the tariff exemption would be temporary, Mr Martin said: “We don’t know that. I think what’s happening there is it’s much more complex than might have been originally thought on the US side. There are a lot of complex supply chain issues. Also the cost of medicines would go up immediately for American citizens.”
He said pharmaceutical goods produced in Denmark, Belgium and Ireland were often intermediate products that required further work in the US.
“You can’t relocate them overnight and so the US could end up doing more damage to its own companies. I don’t think that’s what they want.”
06:20 PM BST
Fed will have to cut rates, says analyst
The US Federal Reserve will have little choice but to cut interest rates, an analyst at US stockbroking giant Charles Schwab has said.
Kathy Jones, at the Schwab Center for Financial Research, said: “I really don’t think [the US Fed] have much choice but to go ahead and cut rates. It doesn’t solve everybody’s problems. A couple of Fed rate cuts will not solve the problem inflicted by tariffs. It can mitigate it, but it can’t solve it.”
“The bottom line is none of this really makes sense so why are we in a trade war with Canada when we have a trade surplus with Canada outside of energy and we need their energy to keep the East Coast lit up, the lights on in New York? So this is not like a well thought out, sensible policy, in my view.”
“You can count on a fair amount of volatility ... but until there’s actually a change in the policy or evidence of real negotiations going on, the market’s going to be under pressure.”
06:11 PM BST
US central banker says Fed in no hurry to change rates
A central banker who helps decide US interest rates has played down the need for rate changes in the wake of Donald Trump’s tariff war.
Philip Jefferson said there would be a “modest softening” of the jobs market this year but that it remains “solid”.
“In my view, there is no need to be in a hurry to make further policy rate adjustments,” he said.
Traders are betting on three and a half quarter point cuts to interest rates by the end of the year, up from three yesterday.
06:04 PM BST
Trade war means Ireland should leave the EU, says Conor McGregor
Conor McGregor, the Irish mixed martial arts fighter who lost a civil trial for rape, has suggested Ireland should leave the EU.
McGregor was entertained at the White House by Donald Trump and is expected to run to be Ireland’s president.
He said it was an “abomination” to be charged double the UK tariff.
“What on earth are we charging our brothers in the US 20pc for at the order of the EU?,” he said.
“Ireland will separate here and we will charge 10pc on Irish goods to the US and the US will charge 10pc to us also. Fair play. Otherwise, and maybe the caveat in all of this, we should no longer be in the EU.”
Irish support for EU membership is high.
06:03 PM BST
Trade war slams breaks on US services sector
The US services sector slowed to a nine-month low in March, as economic growth likely stalled amid uncertainty over tariffs.
The Institute for Supply Management (ISM) said on Thursday that its non-manufacturing purchasing managers’ index (PMI) dropped to 50.8 last month, the lowest reading since June 2024, from 53.5 in February. Economists polled by Reuters had forecast the services PMI would ease to 53.
A PMI reading above 50 indicates growth in the services sector, which accounts for more than two-thirds of the economy.
Steve Miller, chairman of the ISM services business survey committee, said: “There has been a significant increase in the number of respondents reporting cost increases due to tariff activity.”
Christopher Rupkey, chief economist at Fwdbonds, said: “This adverse trade news from the White House is an extreme external shock to the economy ... and so too is the need for being on high alert for signs of recession.”
05:56 PM BST
European shares slump as investors grapple with tariff fallout
European shares tumbled today, hitting their biggest daily loss in eight months.
The pan-European Stoxx 600 sank 2.7pc, falling back to its lowest since January. German, Italian and French benchmarks closed over 3pc lower, with Italian and French stocks seeing their worst fall in over two years.
A gauge of eurozone stock market volatility spiked to an eight-month high.
Hugh Gimber, global market strategist at JP Morgan Asset Management, said: “The market reaction makes it very clear that last night’s announcement was worse than expected.”
He added: “If tariff levels persist, we see a bigger downward shock to growth than upside shock to inflation, that’s critical for the ECB ... if tariff policy is maintained I see ... a more aggressive path of rate cuts in the eurozone.”
05:50 PM BST
Lesotho to send delegation to US ‘urgently’ after tariffs hike
Lesotho has said it will send a government delegation to the United States to plead its case after Washington imposed 50pc tariffs on its imports, the highest for a single nation.
The small southern African kingdom topped the list of many countries hit with sweeping tariffs by Donald Trump yesterday in an intensifying global trade war.
“We need to urgently travel to the US to engage with its executives and plead our case,” trade minister Mokhethi Shelile told reporters. “My biggest concern was the immediate closure of factories and job losses.”
Lesotho’s annual gross domestic product of $2bn (£1.5bn) is highly reliant on exports of mostly textiles, including jeans.
“There are 11 factories in the country, most of which export goods to the US and provide employment to 12,000 workers,” Mr Shelile said.
“Goods currently in production will be affected by these tariffs and will not be exported to the US,” he said, adding he had asked factories to continue operating “while we work on solutions”.
The minister said the US action showed that the country needs to “diversify” its trade relationships and it had already started exploring alternatives.
“We cannot rely solely on the US,” he said. “While this transition will take time, the process is already under way.”
05:43 PM BST
Trump tariffs bigger than those which fuelled the Great Depression, says Irish minister
An Irish government minister has said that the scale of the tariffs announced by the Donald Trump has not been seen for 100 years.
Jack Chambers, Ireland’s minister for public expenditure, said: “If you look at the fundamentals of what’s being imposed, it’s going to have a serious impact on consumer confidence, it’s going to have an impact on investment confidence, potentially increases costs and inflationary impacts on ordinary citizens.
“All of that yields great uncertainty. The last time the scope or extent that this was tried globally in trading terms, was in the early around 1930 which led to the Great Depression.
“In fact, the tariffs that are being imposed now are in excess of that.
“We’re in a we’re in a different, more diverse global economy. And we were coming to this for a point of strength from the Irish perspective...
“But what’s been announced yesterday, and the extent of it hasn’t been seen for 100 years, and it will be a great disruptor to the trading environment as we know today.”
05:39 PM BST
Apple will struggle passing on tariffs costs, says analyst
Apple will have struggle to pass on the cost of tariffs on to US consumers, an analyst has predicted.
Angelo Zino, equity analyst at CFRA Research, said Apple would find it difficult to increase the prices of Apple’s already premium-priced phones.
“We expect Apple to hold off on any major increases on phones until this fall when its iPhone 17 is set to launch, as it is typically how it handles planned price hikes,” he said.
Most iPhones are made in China. Even with some production moving to Vietnam and India, those countries were not spared from tariffs yesterday, with Vietnam receiving a 46pc levy and India’s coming in at 26pc.
Apple would need to raise its prices by at least 30pc on average to offset import duties, according to Counterpoint Research co-founder Neil Shah.
A potentially sharp price hike could dampen demand for the smartphone and give South Korea’s Samsung an edge, as the Asian country faces lower tariffs than China.
“Our quick maths on Trump’s tariff Liberation Day suggests this could blow up Apple, potentially costing the company up to $40 billion,” Rosenblatt Securities’ Crockett said.
“It’s hard for us to imagine Trump blowing up an American icon ... but this looks pretty tough.”
05:31 PM BST
Wall Street’s verdict on Trump’s tariffs is ‘damning’
Wall Street has given Donald Trump’s trade policies the thumb’s down, an analyst has suggested.
Danni Hewson, head of financial analysis at stockbroker AJ Bell, said: “Donald Trump might be able to write off some of today’s commentary as hyperbole but even he can’t ignore the numbers.
“For a president who used to use Wall Street as his own personal scorecard, today’s market assessment of his tariff plans has been damning. Around $2.2 trillion has been wiped off the value of global stock markets at the time of writing, with the US bearing the brunt of the tariff induced sell-off and the Nasdaq set to experience its largest daily drop since March 2020.
“Comparisons will be made to 2020’s global pandemic and 2008’s financial crash, but looking forward we must consider that ‘liberation’ may ultimately end in recession.
“Companies like Apple, which relies on its complicated global supply chain and on positive consumer sentiment, slumped a whopping 8pc as investors pondered exactly how badly the tech company’s bottom line will be thwacked by this White House policy.”
05:18 PM BST
Britain plots retaliatory tariffs against Trump
The UK will consult British businesses on how the Government could impose retaliatory trade tariffs on the US, Jonathan Reynolds has announced.
The Business and Trade Secretary said businesses will be asked over the next four weeks about which US products “could potentially be included in any UK tariff response”.
The Government has drawn up a list of items that could be subject to tariffs, ranging from jeans to jet fuel. The document runs to more than 400 pages and includes over 8,000 potential categories of goods.
However, Mr Reynolds stressed the Government’s preference would be to strike an economic deal with the US to mitigate the impact of Donald Trump’s 10pc tariff on UK goods.
Sir Keir Starmer said at a local elections event that Britain was entering a “new era” on trade but added that he does not “think we should jump into a trade war”.
He said: “Nobody wants a trade war, I need to act in the national interest and the choice before us is whether to jump into retaliatory action with both feet at the get-go, or continue with our calm approach to negotiate a trade deal to mitigate the tariffs if we can. I think the second one is the right approach.”
The decision to announce the consultation and the accompanying timetable will be seen as an attempt to fast track talks with the White House.
It comes hours after European Commission president Ursula von der Leyen said the EU was prepared to retaliate against Mr Trump’s levies, which she described as a “major blow” to the world economy.
Mr Reynolds said the consultation will be paused if a deal can be done and the Government will today publish a draft list of US products which could be targeted.
He told the House of Commons: “It remains our belief that the best route to economic stability for working people is a negotiated deal with the US that builds on our shared strengths.
“However, we do reserve the right to take any action we deem necessary if a deal is not secured.
“To enable the UK to have every option open to us in future, I am today launching a request for input on the implications for British businesses of possible retaliatory action.
“This is a formal step necessary for us to keep all options on the table. We will seek the views of UK stakeholders over four weeks until May 1, 2025, on products that could potentially be included in any UK tariff response.
“This exercise will also give businesses the chance to have their say and influence the design of any possible UK action.”
The Prime Minister earlier admitted to business leaders at a meeting in Downing Street that “there will be an economic impact from the decisions the US has taken”.
05:10 PM BST
Macron says EU retaliation will come in two doses
Emmanuel Macron has said that the EU will inflict retaliation on the US in two stages, as he attacked Donald Trump’s “brutal and unfounded” trade war.
He said that Americans will be “weaker and poorer” after Mr Trump’s tariff announcement, which he said would have a “massive impact” on the European economy.
Europeans “need to remain united and determined in this phase. And I say this also because I know what can happen - the biggest players have a tendency to go it alone, and that’s not a good idea,” he said.
Macron reaffirmed the French government’s position that a “European response” would come in “two stages”.
“The first response will take place in mid-April and will address the tariffs already decided, particularly on steel and aluminium,” he said.
“The second, more massive response, to the tariffs announced yesterday, will take place at the end of the month after a detailed study, sector by sector, and work with all member states and economic sectors,” he said.
05:04 PM BST
Carney hits back with tariffs on US cars
Canada will retaliate against Donald Trump’s tariffs, Mark Carney, the Canadian prime minister, has said.
The country will impose 25pc tariffs on on some American-made cars in a measure that mirrors Donald Trump’s tariffs on Canadian cars.
Mr Carney said there would be “25 percent tariffs on all vehicles imported from the United States that are not compliant with CUSMA,” using the Canadian initialism for an existing North America free trade agreement.
He added: “Given the prospective damage to their own people the American administration should eventually change course. Although their policy will hurt American families, until that pain becomes impossible to ignore, I do not believe they will change direction, so the road to that point may indeed be long. And will be hard on Canadians just as it will be on other partners of the United States.”
He said: “The 80-year period when the United States embraced the mantle of global economic leadership, when it forged alliances rooted in trust and mutual respect and championed the free and open exchange of goods and services, is over. This is a tragedy.”
The Canadian premier did not immediately offer detail on how many vehicles could be impacted by Canada’s retaliation, but called his response “focused and calibrated”.
04:54 PM BST
Trump tariffs an ‘economic catastrophe’ for Germany
Donald Trump’s tariffs are an “economic catastrophe” that will cost the German economy hundreds of billions of euros, a leading policy institute has warned.
The Cologne Institute for Economic Research estimated that the Trump tariffs will cause €200bn (£160bn) in damages to German finances.
It estimated that the wider damage to the European Union could run to €750bn (£630bn).
“For Germany, the tariff of 20 per cent is an economic catastrophe,” Jürgen Matthes and Samina Sultan, the authors of the report, said.
Annalena Baerbock, the outgoing German foreign minister, described Mr Trump’s “liberation day” as being an “absolutely awful day” for the global economy.
04:49 PM BST
Tariffs doomed to kill off America’s golden goose, says analyst
Donald Trump could be able to kill America’s golden goose, a market analyst has suggested.
Chris Beauchamp, of online trading platform IG, said: “The key feature of the last two years and more has been the resilience of the US economy.
“Trump’s tariffs, along with the government job cuts and the potential for massive spending cuts, seem doomed to kill the goose that laid the golden egg.
“Of course Trump and his team hope that their tax cuts and deregulation agenda can create a bounce-back that will shock and awe the world, but the pain that has to come first is likely to be brutal for equity markets worldwide.”
04:46 PM BST
No chance Trump will back off tariffs, Lutnick says
There is no chance Donald Trump will back off his tariffs, US commerce secretary Howard Lutnick has said.
“The President is not going to back off what he announced yesterday. He is not going to back off,” Mr Lutnick said in an interview with CNN.
04:40 PM BST
Germany warns of ‘arm-wrestling match’ against US
Robert Habeck, the German economy minister, held up a sheath of papers containing what he said were EU retaliatory measures against the United States at a press conference on Thursday - but refused to reveal them in detail.
“These are the counter measures,” he said, holding up the papers. “Printed double sided, as you can see, on the front and the back ... it goes through the various products list by list.”
He said it was crucial that Germany, and the wider EU, defended the economy from Mr Trump and that strong countermeasures were needed. “We will see who is stronger in this arm-wrestling match,” he said.
Mr Habeck has warned that the challenges posed by the US tariff surge are comparable to those of the 2022 energy crisis and Russian invasion of Ukraine.
The US tariffs run the risk of “unemployment and the destruction of people’s livelihoods” in Europe, he said.
04:36 PM BST
Volvo to step up US production after tariffs
Sweden’s Volvo Cars will increase its production of vehicles in the United States, its boss has said.
As of today, cars manufactured outside the United States are subject to a 25pc tariff, while a tariff on spare parts is also set to gradually come into effect.
Volvo Cars, which is majority owned by China’s Geely, assembles its EX90 electric model at its plant near Ridgeville in South Carolina as well as the Polestar 3.
“We will have to increase the number of cars we build in the US, and surely move another model to that factory,” its chief executive Hakan Samuelsson told Bloomberg.
The carmaker warned in February that it expected a challenging year in 2025, notably due to the threat of tariffs and the slowing pace of electrification.
04:25 PM BST
Trump suggests US economy is now ‘healing’
In a social media post seemingly about tariffs, Donald Trump has suggested that his surgery on trade is over and that the US economy is now healing.
04:22 PM BST
‘Markets may actually be under-reacting’, says investment manager
Markets could be “under-reacting”, an investment manager has claimed, amid fears that Donald Trump’s tariff war could inflict sizeable damage to the world economy.
“Markets may actually be under-reacting, especially if these rates turn out to be final, given the potential knock-on effects to global consumption and trade,” said Sean Sun, portfolio manager at Thornburg Investment Management. However, he sees Trump’s announcement on Wednesday as more of an opening move than an endpoint for policy.
However, UBS said that it is “plausible” that the tariffs could knock down US economic growth by 2 percentage points this year and raise inflation close to 5pc.
Such a hit would be so frightening that it “makes one’s rational mind regard the possibility of them sticking as low,” according to Bhanu Baweja and other analysts at UBS.
Wall Street had long assumed Trump would use tariffs merely as a tool for negotiations with other countries, rather than as a long-term policy. But Wednesday’s announcement may suggest Trump sees tariffs more as helping to solve an ideological goal - wresting manufacturing jobs back to the United States in a process that could take years - than just an opening bet in a poker game.
04:17 PM BST
Brazil to take ‘all appropriate measures’ against Trump tariffs
Brazilian president Luiz Inácio Lula da Silva has said his government would take “all appropriate measures” to defend Brazilian firms and workers from the impact of Donald Trump’s tariffs.
“We defend multilateralism and free trade,” he said at an event in Brasilia.
04:15 PM BST
JP Morgan says Trump tariffs the largest tax increase since 1968
Donald Trump’s latest tariffs are the largest tax rise since 1968, according to US banking giant JP Morgan.
Michael Feroli, the bank’s chief US economist, warned it could hike US inflation, saying it could add as much as 1.5pc to the Fed’s preferred measure.
He said: “This impact alone could take the economy perilously close to slipping into recession. And this is before accounting for the additional hits to gross exports and to investment spending.”
04:06 PM BST
Tesla hammered as Trump tariffs hit American carmakers
Elon Musk’s Tesla is among the American car makers that will be hammered by Donald Trump’s tariffs on imported vehicles and parts.
Though the President’s “liberation day” measures are aimed at foreign cars, they will still cause havoc for US-based manufacturers that are reliant on global supply chains, according to analysts at Wall Street firm Wedbush Securities.
They said domestic car makers sourced 40pc to 50pc of their components overseas, with Mr Trump’s tariffs threatening “a debacle of epic proportions” that would add between $5,000 and $10,000 to the price of a typical car - rising to $15,000 for luxury vehicles.
In a note to clients on Thursday, Dan Ives, a normally-bullish analyst at Wedbush, said: “The winner in our view from this tariff is NO ONE… as even Tesla still is clearly hit from these tariffs and will be forced to raise prices.”
Price rises as a result of the tariffs would result in a 15pc to 20pc drop in demand for cars in the US this year, Mr Ives and his colleagues predicted.
They also predicted that shifting even just 10pc of auto supply chains to America would take three years and cost “hundreds of billions with much complexity and disruption”.
“The tariffs are a debacle of epic proportions for the auto industry and US consumers, as the concept of a US-made car with all US parts is a fairy tale fictional narrative,” Mr Ives added.
“The more people we speak with from the auto industry around the world, it is becoming crystal clear this tariff policy will cause pure chaos to the global auto industry”.
04:02 PM BST
US senators seek to rein in Trump’s authority over tariffs
Two senior lawmakers on the US Senate finance committee are introducing legislation seeking to rein in Donald Trump’s ability to impose tariffs.
Republican Senator Chuck Grassley and Democrat Maria Cantwell are proposing a law that would require Mr Trump to notify Congress on new tariffs with an explanation of the rationale including an analysis of the potential impact on American businesses and consumers.
Within 60 days, the US Congress would need to pass a joint resolution of approval on the new tariff, otherwise all new tariffs on imports expire.
The bill is modelled on the War Powers Resolution of 1973, and would re-establish limits on the president’s ability to impose unilateral tariffs without approval from Congress.
04:00 PM BST
Wall Street plunges as Trump’s tariffs spark recession fears
Stock markets on Wall Street have plunged after Donald Trump’s sweeping tariffs sparked fears of a possible recession.
The benchmark S&P 500 index slumped by up to 4.4pc, wiping off nearly $2 trillion (£1.5 trillion) from the value of America’s biggest companies. Meanwhile, the Dow Jones lost up to 3.8pc and the tech-heavy Nasdaq dropped as much as 5.7pc.
The sell-off in New York was heavier than those seen in the UK and Europe. The FTSE 100 was down 1.4pc in afternoon trade, while France’s CAC 40 was down just over 3pc and the German Dax was 2.7pc lower.
While Mr Trump has claimed his new tariffs will bring jobs back to America and make the country rich, investors are concerned his sweeping changes could trigger a recession in the world’s biggest economy.
Elias Haddad, an analyst at investment bank Brown Brothers Harriman, said the trade war could now “get nasty and that is spooking investors” with a “heightened risk of either recession or stagflation.”
Doug Ramsey, chief investment officer at Minneapolis-based Leuthold Group, told Bloomberg: “I wouldn’t say a recession is inevitable, but the deeper the correction runs, recession odds will increase.”
03:49 PM BST
Macron calls for suspension of French investment in US
Emmanuel Macron has called on French companies to suspend new investments in the US in comments to French business leaders.
In comments reported by Bloomberg, he said: “What would the message of having big European players that invest billions in the American economy at the same time they are hitting us. We must have collective solidarity.”
03:45 PM BST
Italy’s food sector risks losing €1.6bn of exports
Italy’s farming and food production sector risks losing €1.6bn (£1.4bn) of exports to the US as a result of Trump’s tariffs, it was claimed today.
The president of Coldiretti, the country’s principal agricultural association, said Italian farmers, winemakers and producers should brace for huge disruption.
“We had hoped common sense would prevail. Unfortunately, it did not,” said Ettore Prandini, president of Coldiretti.
“There is no doubt that there is a huge risk for the agro-food industry. We risk losing €1.6bn in exports, especially in some sectors, such as the wine sector, which is an area of excellence.
“But diplomatic efforts must not stop, especially by EU institutions, to pursue a path that can lead us to reverse the introduction of 20pc tariffs by President Trump on all European and Italian goods.”
03:42 PM BST
Labour needs to ‘up its game’ on tariffs, says Stride
Shadow chancellor Mel Stride said the Government needs to “up its game” and secure a deal with the US to avoid tariffs.
Asked whether he was concerned about the impact of tariffs on the UK economy, Mr Stride said: “Of course, we have to be concerned.
“We’re a very open economy, and this will have a serious impact.”
Speaking on a visit in south London, the shadow chancellor added: “I think the really disappointing thing is the amount of time that was wasted by this Government before it got in the room with the American administration to try and negotiate that vital free trade agreement so that we don’t have to face these tariffs at all.
“What the Government has got to do now is up its game and go and get that deal so that we can be spared this tariff.”
03:30 PM BST
US redundancies worst since Covid lockdowns
American employers announced more redundancies last month than at any point since the Covid lockdowns of 2020, amid Donald Trump and Elon Musk’s efforts to slash the Government workforce.
A total of 275,240 job cuts were planned in March, according to consultancy Challenger, Gray and Christmas, more than three-times the 90,309 in the same month of last year.
Of those, 216,215 were federal government employees.
Andrew Challenger at the agency said: “Job cut announcements were dominated last month by Department of Government Efficiency [Mr Musk’s Doge] plans to eliminate positions in the federal government. It would have otherwise been a fairly quiet month for layoffs.”
In the first three months of the year, almost half a million layoffs were announced, also the highest since the third quarter of 2020, more than half of which were attributed to Doge’s plans.
Samuel Tombs at Pantheon Macroeconomics said the figure “is less alarming than it first appears” as “many [layoffs] likely will be blocked by the courts or scrapped.”
“Nonetheless, private sector layoff announcements, as recorded by Challenger, were still relatively high at 59,000 in March,” which is 17pc higher than the monthly average.
“The further increase in economic policy uncertainty over the last couple weeks likely will boost layoffs further in April and May. Accordingly, we continue to expect the unemployment rate to trend up this year, reaching about 4.5pc in the fourth quarter.”
On top of that the number of Americans making continuing unemployment insurance claims rose to 1.9m, a level not seen since November 2021.
The number of initial claims by the newly jobless slid a touch to 219,000.
03:28 PM BST
Trump’s highest tariff will ‘kill’ impoverished African kingdom of Lesotho
Donald Trump’s 50pc tariff on Lesotho will “kill” the tiny Southern African kingdom, an economist there has said.
Lesotho, which Trump described in March as a country “nobody has ever heard of”, is one of the world’s poorest nations with a gross domestic product of just over $2bn (£1.5bn).
It has a large trade surplus with the United States, mostly made up of diamonds and textiles, including Levi’s jeans.
Its exports to the United States, which in 2024 totalled $237m, account for more than 10pc of its GDP.
Mr Trump said the “reciprocal” tariffs were a response to duties and other non-tariff barriers put on US goods. Lesotho charges 99pc tariffs on American goods, according to the Trump administration.
Thabo Qhesi, a Lesotho-based economist, said: “The 50pc reciprocal tariff introduced by the US government is going to kill the textile and apparel sector in Lesotho.”
Oxford Economics said its textile sector, with some 40,000 workers, accounted for roughly 90pc of the country’s manufacturing employment and exports.
Mr Qhesi said that the effects of the tariffs would damage the whole economy as the effects spread around the economy.
“So Lesotho will be dead, so to say.”
03:22 PM BST
China’s credit rating cut as government debt rises
Credit rating agency Fitch has downgraded China’s credit rating from A+ to A, noting weakening finances and debt concerns.
“The downgrade reflects our expectations of a continued weakening of China’s public finances and a rapidly rising public debt trajectory during the country’s economic transition,” it said.
China’s Ministry of Finance said the “downgrade of China’s sovereign credit rating is biased ... We deeply regret this and do not recognise it.”
US duties have threatened to harm China’s fragile economic recovery as it struggles with a long-running debt crisis in the property sector and persistently low consumption.
Beijing is pushing for economic growth of around five percent this year, although the intensified trade war will likely mean China cannot peg its hopes on its exports, which reached record highs in 2024.
03:16 PM BST
Investors send down US shares as they weigh up risk of bear market
Wall Street is falling this afternoon after opening noticably down. The S&P 500 is currently down 4pc, the Nasdaq by 4.9pc and the Dow Jones by 3.6pc.
Doug Ramsey, chief investment officer at Minneapolis-based Leuthold Group, told Bloomberg: “I wouldn’t say a recession is inevitable, but the deeper the correction runs, recession odds will increase. The current decline is the first leg down in a new bear market, and not simply a correction.”
Elias Haddad, an analyst at Brown Brothers Harriman, said the trade war could now “get nasty and that is spooking investors” with a “heightened risk of either recession or stagflation.”
He added: “We could see the correction bottom out when we have firm evidence that we’re not falling into recession.”
03:14 PM BST
Apple loses more than $300bn in value
Apple has lost more than $300bn in value as the iPhone maker prepares for a huge hit to profits from Donald Trump’s tariffs.
Shares in the company were trading down 9pc on Thursday. Apple makes most of its iPhones in China but also imports electronics from India and Vietnam, two countries that were hit with heavy tariffs by the White House.
Tim Cook, Apple’s chief executive, has a close relationship with Donald Trump and secured tariff exemptions during the President’s first term but there were few signs of leniency in Wednesday night’s announcement.
Analysts believe the company will have to raise US iPhone prices or take a heavy hit to profits.
The $300bn drop would be among the largest-ever single day losses of value for a company, although less than the $592bn Nvidia lost in January as markets panicked about the impact of China’s Deepseek.
Apple has pledged to invest $500bn in the US over the next four years.
02:51 PM BST
Vauxhall owner pauses work at Canada and Mexico factories
The owner of Vauxhall is temporarily halting work at factories in Canada and Mexico as US tariffs begin to impact operations across the automotive industry.
Stellantis, which also owns Jeep and Maserati, will pause its factory in Ontario for two weeks from Monday. It wasn’t immediately clear how long the Mexico operations would be affected.
Antonio Filosa, chief operating officer for the Americas, said in a memo to employees:“With the new automotive sector tariffs now in effect, it will take our collective resilience and discipline to push through this challenging time.”
The move will affect employees at “several” of the company’s US powertrain and stamping facilities that support the Canada and Mexico operations, he said.
The production changes are some of the first concrete effects from US President Donald Trump’s decision to impose 25pc tariffs on auto imports, which came into effect today.
02:44 PM BST
Signs of division in EU’s tariffs response
There are some early signs of EU divides over how to respond to the US tariffs.
France and Germany have suggested targeting US tech firms in response.
But Ireland, where companies like Apple, Google and Meta have their European headquarters, is opposed.
Ireland’s Taoiseach Micheál Martin said he was not in favour of a digital services tax and called for a “considered” and “measured” response from Brussels.
Earlier, Simon Harris, the deputy prime minister told the Irish parliament that the announcement of the US tariffs were a “moment of chaos”.
“At some point the European Union, which has shown huge restraint, is going to have to say ‘hang on a second, if you’re not willing to negotiate or get around the table there is going to have to be a response’,” Mr Harris said.
02:38 PM BST
Wall Street slumps at the open
Wall Street has plunged at the opening bell as Trump’s sweeping tariffs ignited fears of an all-out trade war and heightened the risk of a global economic recession.
The benchmark S&P 500 slumped 3.2pc, while the Dow Jones was down 2.7pc. The tech-heavy Nasdaq dropped 4.5pc.
02:35 PM BST
JCB to double size of US factory after tariffs hit
JCB will double the size of a new factory currently under construction in Texas, shifting production from Europe to the USA, as it confirmed it will take a hit from tariffs.
The digger maker has been manufacturing in the US for 50 years, and last year bought 400 acres of land in San Antonio as part of an expansion plan.
Graeme Macdonald, chief executive of JCB, said Trump’s tariffs would have a “significant” impact on its business in the short term, but said shifting production to the US would help mitigate the blow.
JCB will now double the size of the new factory to 1m square feet. The new $500m plant is due to start production next year and employ up to 1,500 people.
JCB chairman Lord Bamford said: “JCB has been in business for 80 years this year and we are well accustomed to change.
“The United States is the largest market for construction equipment in the world and President Trump has galvanised us into evaluating how we can make even more products in the USA, which has been an important market for JCB since we sold our first machine there in 1964.”
02:27 PM BST
Read: Ministers draw up list of goods for potential US tariffs
Jonathan Reynolds has said he will consult businesses on how the Government could impose retaliatory trade tariffs on the US.
Now, ministers have drawn up a list of items that could be subject to tariffs, ranging from jeans to jet fuel. The document runs to more than 400 pages and includes over 8,000 potential categories of goods.
02:11 PM BST
Chemical producers ‘looking at UK future’
Chemical producers are “looking at their UK future” as Donald Trump’s tariffs hammer an industry already battling high energy costs and a global supply glut, it has been warned.
UK chemical exports to the US are worth about £5bn a year, representing around one quarter of international sales. Pharmaceuticals are worth another £6bn, according to the Chemical Industries Association.
Several UK companies such as Dow also operate in the UK, with materials being sent to and fro across the Atlantic, while the industry’s products feed into all kinds of other manufactured goods - raising the prospect of higher costs spreading to other sectors.
The trade tariffs come as the industry has already been struggling under high gas and electricity prices, and a flood of supplies coming out of China, which have forced several British factories to be mothballed or closed.
Steve Elliott, chief executive of the Chemical Industries Association, said: “The confirmation by America that it will now cost UK chemical businesses 10pc more to export what they make to our biggest single market is another blow to our industry and to our manufacturing-wide customer base.
“On top of paying energy bills which are 400pc higher than those in the US and up to 100pc more than in Europe, these additional costs will mean companies looking again at their UK future.
“Whilst the Government is right to think before pressing the retaliation button... talks between our respective administrations must proceed as quickly as possible.”
02:01 PM BST
Analysis: Britain risks standing out (in the wrong way)
Just hours after Sir Keir Starmer insisted Britain will respond to Donald Trump’s trade tariffs with “cool and calm heads”, his Business Secretary threatened to threaten to slap new taxes on American imports.
Jonathan Reynolds’ consultation on possible retaliatory action runs the risk of both raising tensions with the US and worsening the economic pain in Britain, as tariffs are a tax on the businesses and families which want to buy American goods.
Not every nation in the UK’s position is adopting the same aggressive stance. Australia is among those which suffered the same 10pc tariff under Trump’s new policy, despite its free trade agreement with the US.
The American President justified the tax by objecting to Canberra’s strict biosecurity rules which hit imports of US meats. But instead of striking back with its own taxes or even using the dispute mechanism in the FTA, Anthony Albanese, the Prime Minister, declined to go beyond firm language.
“The administration’s tariffs have no basis in logic, and they go against the basis of our two nations’ partnership,” he said. Imposing tariffs of its own would kick off “a race to the bottom that leads to higher prices and slower growth”.
Similarly Singapore, which also faces a 10pc tariff, said retaliation is not in its citizens’ interests. Gan Kim Yong, the city-state’s deputy Prime Minister, said he is “disappointed” with the imposition of the border tax but will not add to the problem with its own tariffs.
“Retaliatory import duties will just add cost to our imports,” he said, adding that the first step will be to speak with the Americans to work out why Singapore has been targeted. “If there are no specific concerns, then it’s more difficult to argue or to negotiate.”
New Zealand is also playing it cool in the face of a 10pc levy: retaliation “would put up prices on consumers and that would be inflationary,” said Todd McClay, the country’s trade minister.
Given Trump’s threat to ramp up tariffs further “should any trading partner retaliate against the United States in response to this action through import duties on US exports or other measures,” that might be a sensible initial response.
Britain risks standing out in the wrong way if it shoots consumers in the foot and riles Trump further with tariffs of our own.
01:51 PM BST
Workers must not ‘pay the price’ for tariffs, unions warn
Trade unions are scrambling to respond to the tariffs as they brace for thousands of job cuts.
Unite, Labour’s biggest union backer, has called on the government to take “immediate action” to ensure that UK workers “do not pay the price” for the tariffs with job losses or pay cuts.
The union said government action must include a total reform of the zero emission vehicle (ZEV) mandate for UK produced cars and an immediate reduction in industrial energy prices which make UK goods uncompetitive.
It also urged the government to designate the steel industry a critical national infrastructure area to ensure that all UK infrastructure projects use UK steel and said there must be a commitment to buy British goods wherever possible, including purchasing new UK built Typhoon jets and not American made F-35s.
Unite general secretary Sharon Graham said the government “cannot allow a situation where yet again UK workers pay the price. It is likely that some employers will now use the issue of tariffs at the bargaining table, in an attempt to push down pay”.
Paul Nowak, the general secretary of the Trades Union Congress, which represents millions of workers, said that “in the face of punitive and arbitrary US tariffs, the government must do everything it can to protect British jobs and industry”.
He added: “Donald Trump has just made the strongest possible argument for the UK to positively reset its economic relationship with the EU, our largest market.”
01:45 PM BST
US Senate backs Canada over tariffs in rare Trump rebuke
The US Senate has passed legislation that would terminate new tariffs on Canada in a rare rebuke of Donald Trump, hours after the president unveiled a raft of reciprocal tariffs on other countries.
Kieran Kelly reports:
The Republican-controlled Senate voted 51-48 to approve the Bill and sent it to the House of Representatives, where it is likely to be blocked.
01:36 PM BST
Vance: Trump is taking the US economy in a ‘different direction’
Donald Trump is taking the American economy in a “different direction” and that will be a “big change” for the country, JD Vance the Vice President has said.
He told Fox News: “President Trump is taking his economy in a different direction. He ran on that, he promised to announce [tariffs].
“This is a big change. I’m not going to shy away from it, but we need a big change.
“We cannot keep going down the Joe Biden pathway where we have $2 trillion of peacetime debt, deficits. We have manufacturing disappearing. That is not working for Americans.”
01:27 PM BST
Meloni holds crisis meeting over tariffs
Giorgia Meloni is holding an emergency meeting of key ministers to discuss the tariffs.
The Italian prime minister has convened a ‘taskforce’ of cabinet ministers, including those responsible for the economy, agriculture and European affairs.
Her two deputy prime ministers – Matteo Salvini, head of the nationalist League party and Antonio Tajani, who is also the foreign minister – are also taking part, according to Ansa, the national news agency.
Ms Meloni last night called the imposition of tariffs by the Trump administration “wrong”.
01:18 PM BST
Co-op: We won’t sell chlorinated American chicken
Co-op has pledged to keep sourcing meat solely from British farms, after Donald Trump pushed for the UK to buy chlorinated US chicken to avoid higher tariffs.
Co-op Food chief Matt Hood said the convenience store group had an “unwavering commitment” to only source its meat from British farms, adding: “It’s because we believe the quality that comes out of this country is as good as anywhere in the world.”
He said even if foreign meat was cheaper and would help it to compete in a supermarket price war, “we will stick to those commitments that we will always source British because we believe in it”.
The comments come amid a push from the US president for Britain to start buying American chlorinated chicken if it wants to negotiate lower tariffs.
The White House said overnight that the UK had “non-science-based standards that severely restrict US exports of safe, high-quality beef and poultry products”.
It signals that the issue is set to come to the fore again, having previously been raised in 2023 during trade talks between the US and the UK.
Rishi Sunak, who was prime minister at the time, said there would “be no chlorine-washed chicken and no hormone-treated beef on the UK market. Not now, not ever”.
Last year, Rachel Reeves said: “We’re not going to allow British farmers to be undercut by different rules and regulations in other countries.”
01:06 PM BST
Starmer: We will press for trade deal before retaliatory tariffs
Sir Keir Starmer ruled out immediate retaliatory tariffs on the United States in the wake of Donald Trump’s trade war and said his focus instead was on securing a trade deal.
The Prime Minister said at the launch of Labour’s local election campaign that it was the “right approach” to continue negotiations to seek a trade deal with the US.
Asked if he felt he was being “played” by Mr Trump, Sir Keir replied: “No, we’ve got a long, deep close relationship with the United States that we’ve had for decades, on defence, on security, on intelligence-sharing. We work more closely as two countries than any other two countries in the world.
“Therefore it’s important we preserve that special, close relationship, the same when it comes to the economy.
“Nobody wants a trade war, I need to act in the national interest and the choice before us is whether to jump into retaliatory action with both feet at the get-go, or continue with our calm approach to negotiate a trade deal to mitigate the tariffs if we can. I think the second one is the right approach.
“I know others are saying why don’t we jump into a trade war from day one, from the get-go, I don’t think that will be in our national interest.”
01:02 PM BST
Ministers could seek new powers to prevent trade dumping
Ministers could seek new powers to protect British businesses from the impact of trade dumping caused by Donald Trump’s tariffs, Jonathan Reynolds said.
The Business and Trade Secretary said so-called “trade diversion” was “something we have to be extremely vigilant about”.
There are fears countries badly affected by the new US tariffs could opt to send goods elsewhere, potentially flooding countries like Britain with products which could undercut domestic firms.
Mr Reynolds said the Government already made use of tools like quotas to protect some sectors like steel production.
He said: “We stand ready to use those powers for any sector of the economy that we need to use them for or indeed to take further powers if that is deemed to be necessary.”
12:51 PM BST
Starmer refuses to rule out welfare cuts in light of tariffs
Sir Keir Starmer declined to rule out further welfare cuts to balance the books at the Budget in the autumn.
Asked if he could guarantee now that he wouldn’t “come back” to make further benefit cuts, the Prime Minister said: “The Autumn Budget is a long way off and there’s a lot of water that will have to go under the bridge before then.
“Obviously my job, the Government’s job, is focusing on progressing the national interest… but at the same time continuing the work we’re doing on growth and reform and changing our economy.”
Sir Keir added: “I’m not going to go into what may or may or not happen in six months’ time. My job is to go through the challenge of tariffs, which is undoubtedly a challenge.”
12:49 PM BST
Trump ridiculed for tariff on uninhabited island
Donald Trump’s tariffs have reached far and wide, provoking anger from governments around the world.
However, the levies have also provoked ridicule after the US placed tariffs on Norfolk Island in Australia, which has a population of 2,200 people and zero exports to the world’s largest economy.
The US also slapped a 10pc tariff on Heard Island and McDonald Islands, which form an external territory of Australia, near Antarctica. They are uninhabited except by colonies of penguins and some other wildlife.
12:43 PM BST
Starmer declines to say if EU wrong to impose tariffs on US
Sir Keir Starmer declined to say whether the European Union was wrong to impose tariffs on the US.
He said: “In my experience it’s not wise to go round telling other countries what they should or shouldn’t do. Every country needs to act in their best interests and no doubt they will do so. My job is to lead the United Kingdom through this focused on our best interests.”
The Prime Minister declined to say whether he believed that the UK only facing tariffs of 10pc, while Brussels has been hit with levies of 20pc, was a Brexit benefit.
“We have our own trading relationship with the US, it is actually a fair and balanced relationship if you look at the numbers and we’ve got decades’ worth of special relationship with the US.
“And I think it’s by focusing on those features that we can take the necessary steps to secure our economy through hopefully a deal, we have options on the table if that’s not possible.”
12:38 PM BST
Starmer: Britain entering ‘new era’ on trade
Sir Keir Starmer said the UK is now entering a “new era” on trade just as it is on defence.
The Prime Minister said: “We are acting in your absolute best interest. A trade war is bad for working people and bad for our businesses, but I don’t think we should jump into a trade war.
“I think it’s better if we try to negotiate a better outcome and that’s what we are trying to do.”
He added: “Over the past few months we’ve been talking about a new era when it comes to defence and security, particularly defence and security, and recognising we are in a changing world and going into a new era and we have to act differently.
“And we’re at a similar point with the economy. This is not a short-term tactical exercise, it is the beginning of a new era… I’m very concerned that we get this argument out there because it means that we have to adapt in ways which go beyond the mere question of tariffs.
“And that’s why I’ve instructed my team to go further and faster in what we need to do, to put more resilience and more strength into our economy.”
12:37 PM BST
Trump tariff maths ‘not credible’, says EU
The European Union has slammed the maths behind Donald Trump’s decision to impose a 20pc tariff on exports from the bloc.
“The methodology, to the extent that there is one, is neither credible nor justified to arrive at these numbers,” a senior EU official told reporters in Brussels.
The duties, they said, would cover about 70pc of the EU’s €370bn of total trade exports to the US.
The new levies announced on Wednesday would add about €81bn of costs to EU trade with the world’s largest economy, they said.
12:21 PM BST
Italian cheese and ham makers fear ‘absurd’ tariffs
Italy fears that signature products such as wine, cheese, prosciutto and fashion and luxury goods will be hard hit by the 20pc tariffs imposed by the US administration.
The president of a consortium of Parmigiano Reggiano cheese makers says the tariffs are “absurd”.
Nicola Bertinelli says that tariffs on Parmigiano will now increase from 15pc to 35pc.
“It doesn’t make sense to apply tariffs to a product like ours that is not in competition with American cheeses,” he said.
The US produces home-grown ‘parmesan’ that is a pale imitation of the wheels of cheese made by the Italians - and much cheaper.
He said the US was the number one export market for Parmigiano, accounting for 22.5pc of overseas sales.
“It is absurd to target a niche product like Parmigiano Reggiano in an attempt to protect the American economy. Imposing tariffs on a product like ours will just raise the cost for American consumers without protecting local cheese producers. It is a decision that harms everybody.”
12:14 PM BST
Britain plots retaliatory tariffs against Trump
The UK will consult British businesses on how the Government could impose retaliatory trade tariffs on the US, Jonathan Reynolds has announced.
The Business and Trade Secretary said businesses will be asked over the next four weeks about which US products “could potentially be included in any UK tariff response”.
However, he stressed the Government’s preference would be to strike an economic deal with the US to mitigate the impact of Donald Trump’s 10pc tariff on UK goods.
The decision to announce the consultation and the accompanying timetable will be seen as an attempt to fast track talks with the White House.
Mr Reynolds said the consultation will be paused if a deal can be done and the Government will today publish a draft list of US products which could be targeted.
He told the House of Commons: “It remains our belief that the best route to economic stability for working people is a negotiated deal with the US that builds on our shared strengths.
“However, we do reserve the right to take any action we deem necessary if a deal is not secured.
“To enable the UK to have every option open to us in future, I am today launching a request for input on the implications for British businesses of possible retaliatory action.
“This is a formal step necessary for us to keep all options on the table. We will seek the views of UK stakeholders over four weeks until May 1, 2025, on products that could potentially be included in any UK tariff response.
“This exercise will also give businesses the chance to have their say and influence the design of any possible UK action.”
12:09 PM BST
Reynolds disappointed by increase in tariffs on Britain
The UK only being hit by 10pc import taxes by the US has “vindicated” the Government’s approach to talks with the United States, the Business Secretary has said.
In a statement to the Commons on Thursday, Jonathan Reynolds described the decision as disappointing.
Mr Reynolds said trade with the US was worth £315 billion, second only to that with the European Union, which is worth £791bn. He said 2.5m jobs in the UK and US are linked to trade between the two nations.
He said: “No country was able to secure an exemption from these announcements, but the UK did receive the lowest reciprocal tariff rate globally. And though this vindicates the pragmatic approach this Government has taken, we know that while these tariffs are still being levied, the job is far from done.
“We are, of course, disappointed by the increase in tariffs on the UK and on other countries around the world. The impact will be felt amongst all trading nations.”
Mr Reynolds said talks with the US on an “economic deal” are still ongoing. He said a deal would “not just avoid the imposition of significant tariffs but would deepen our economic relationship, on everything from defence, economic security, financial services, machinery, tech and regulation”.
12:02 PM BST
Poll: Could Trump’s tariffs actually be good for Britain?
11:48 AM BST
Analysis: Starmer keeping his powder dry
The shape of Downing Street’s response to Donald Trump’s overnight tariffs is becoming clear.
One open question yesterday is now answered: Sir Keir Starmer will not hit back with retaliatory tariffs immediately.
Instead, the Government is doubling down on its strategy of focussing on a slim trade deal with American that in the end would - could - bring tariff exemptions.
Jonathan Reynolds, the Business Secretary, said explicitly in his BBC Radio 4 interview that he hopes Mr Trump’s 10pc blanket tariff would go on UK exports in that trade agreement.
This deliberate “calm” approach will be tested if weeks turn to months and there is still no UK-US trade deal, even as other nations potentially fire back with protectionist moves. But, for now, Sir Keir is keeping his powder dry.
11:43 AM BST
Badenoch: Trump tariffs will make all of us poorer
Kemi Badenoch warned Donald Trump’s tariffs will “not make the US wealthier but they will make all of us poorer”.
The Tory leader suggested the US president had failed to “learn the lessons of history” about the dangers of adopting protectionist trade policies.
She posted her comments on X, formerly Twitter, along with a video clip of Ronald Reagan in which the former US president said “the way to prosperity for all nations is rejecting protectionist legislation and promoting fair and free competition”.
In the clip he said that while protectionism can work for a short time it inevitably results in damaging retaliation, less competition, more trade barriers and job losses.
Mrs Badenoch posted:
11:36 AM BST
Starmer urged not to sacrifice British creative industries for US trade deal
Sir Keir Starmer has been urged not to surrender Britain’s creative industries in an effort to placate Donald Trump.
The Government is preparing a package of economic concessions as part of negotiations with the US over a trade deal, including a potential agreement on artificial intelligence (AI).
This has sparked fears that ministers could further water down copyright laws to allow tech firms to train their AI models on music, newspapers, books and films made by British companies and creators in a move critics say would damage an industry worth £125bn to the UK economy.
Dr Jo Twist, chief executive of record label trade body the BPI, said: “Speculation the Government will offer up concessions on intellectual property, as part of any forthcoming US trade deal, is deeply alarming if true.
“IP and the UK’s gold-standard copyright framework are what protects and enables British creativity to flourish, and underpins the investment made by businesses. Trading this off would work against growth and harm the UK culturally and economically.”
Dan Guthrie, director general of the Alliance for IP, which represents creative sectors including newspapers, book publishers and the Premier League, said: “In relation to any possible discussions on AI regulation between the UK and US as part of any trade negotiations, any concessions in relation to copyright would be against both the UK’s and US’s economic interests, threatening inward investment and exports and would be opposed by the creative sectors in both countries.”
11:31 AM BST
Scholz criticised ‘fundamentally wrong’ tariffs on EU
German chancellor Olaf Scholz slammed sweeping new US tariffs as “fundamentally wrong” as Berlin warned that the European Union could retaliate by targeting American tech titans.
“This is an attack on a trade order that has created prosperity all over the globe, a trade order that is essentially the result of American efforts,” Mr Scholz said, a day after US president Donald Trump unveiled the wide-ranging duties.
Echoing comments by the European Commission president Ursula von der Leyen, Mr Scholz said “we are ready for talks with the American government” to find a solution.
However, he stressed that Europe would “respond decisively, strongly and appropriately” if negotiations fail.
Germany, Europe’s biggest economy, stands to be hit hard by the tariffs as the United States is its top export destination, and its companies ship huge quantities of goods, from cars to chemicals, to the world’s top economy.
11:21 AM BST
EU urged not retaliate to Trump and seek exemption
The American Chamber of Commerce to the EU called on Brussels to avoid a full-blown trade war with the US.
Malte Lohan, chief executive of AmCham EU, said: “These new tariffs, combined with possible EU countermeasures, will only fuel a cycle of retaliation that damages both sides.
“We are calling on the EU to avoid further escalation of the dispute and instead prioritise creating the environment required for negotiating an exemption from the tariffs.”
Markus J. Beyrer, the director general of the BusinessEurope trade association in Brussels said the tariffs undermined the transatlantic economy and risked retaliation.
He said: “In its response, the EU must be united with a legally sound, proportionate, and targeted approach that avoids unintended consequences for EU economic operators. Ultimately, it is in the best interest of both the EU and US to reach a negotiated solution.”
11:16 AM BST
Farage: Free trade deal with US still achievable
Nigel Farage suggested the UK could have avoided Donald Trump’s tariffs if the Tories had “delivered quickly on Brexit” and struck a free trade deal with the US.
A trade deal with the US was highlighted by Brexiteers as one of the big wins from the UK leaving the EU.
But efforts to strike a deal were placed on ice when Joe Biden was president because a trade pact with Britain was not one of his priorities.
Mr Farage said: “10pc tariffs from the USA are bad news, but better than 20pc for EU members.
“If the Tory government had delivered quickly on Brexit we would have had a free trade deal years ago. This deal is still achievable.”
11:11 AM BST
Dollar crumbles as Trump tariffs trigger ‘confidence crisis’
The dollar has plunged around the world as Donald Trump’s reciprocal tariffs triggered a “broader confidence crisis” in the global reserve currency.
The pound surged 1.3pc versus the dollar to $1.317 — its highest level since October — while the euro gained 1.8pc to a six-month high of $1.103. The US currency sank 1.5pc against the Japanese yen.
George Saravelos, an analyst at Deutsche Bank, warned that the “safe haven properties of the dollar are being eroded”.
He said he was “increasingly concerned that the dollar is at risk of a broader confidence crisis” as developments since the start of the year “make us worried about a broader undermining of confidence in the US economic outlook”.
He said: “We would caution that if the dollar decline accelerates, it would be a highly unwelcome development for global central banks.
“The last thing the ECB wants is an externally imposed disinflationary shock from a loss in dollar confidence and a sharp appreciation in the euro on top of tariffs. Expect pushback.
“We are in the midst of dramatic regime change in markets.”
10:50 AM BST
Buy US chlorine-washed chicken if you want lower tariffs, Trump tells Britain
Donald Trump has told Sir Keir Starmer that Britain must start selling chlorinated US chickens if it wants lower tariffs.
The US president has called for the concession after imposing a 10pc levy on goods from the UK to America, claiming that the UK’s restrictions on chlorine-washed poultry and hormone-treated beef were flawed.
After announcing a barrage of sweeping global tariffs on Wednesday, the White House released a statement saying: “The UK maintains non-science-based standards that severely restrict US exports of safe, high-quality beef and poultry products.”
This formed part of Mr Trump’s narrative that America has been subject to unfair treatment from countries around the world, including the UK.
10:45 AM BST
Israel disappointed with tariffs after lifting duties on US imports
The US decision to impose 17pc tariffs on Israeli products imported into the US has been met with quiet disappointment in the Jewish state, whose government has been revelling in its newfound alignment with the Trump White House on matters of security.
In an apparent last-minute effort to persuade Mr Trump to be lenient, the finance secretary, Bezalel Smotrich, signed a directive on Tuesday ordering the lifting of all import duties on US products coming into Israel.
These are not much in the first place - about $11 million a year - given that Israel and the US have enjoyed a free trade agreement since the mid-1980s which allows relatively certain exceptions designed to protect small Israeli producers from cheap imports, largely in the agricultural sector.
Overall, US-Israel goods trade was an estimated $37bn in 2024, with a deficit in Israel’s favour of $7.4bn, an increase of 8.6pc on the previous year.
The government’s emergency directive will only come into force when approved by the Knesset finance committee, although that could take place within days.
There are hopes in some quarters that this will prompt the Trump administration to reduce its import rate for Israel.
Amid this scrambled initiative, there is a parallel effort to understand why the White House has acted in the way it has.
An administration official told reporters in recent days: “Israel steals a lot of intellectual property from, for example, the pharmaceutical manufacturers in this country.”
If Mr Trump’s problem really is high-level IP theft, then scrapping a relatively small amount of import tariffs on agricultural goods may not have the desired impact.
In the meantime, the Israeli agricultural sector has sounded alarm over the effect on its smaller farmers. At the same time others have suggested the measure might go a small way to improving the cost of living for Israeli consumers.
10:41 AM BST
German economy sent ‘back to the 1930s’
German economists have reacted with alarm to the tariffs, warning they increase the risk of a recession and will bring down GDP.
One top economist claimed Germany was going “back to the 1930s.”
Achim Wambach, president of the German Centre for Economic Research, said: “The economic consequences are grave, particularly for Americans. Prices and inflation will rise, and a recession will become more likely.”
“This is a dark day for German exports,” said Jorg Kramer, an economist at Commerzbank.
He warned that German GDP could fall by half a per cent over the next two years as a result of the tariffs.
Carsten Brzeski, an economist at ING, claimed: “The 1930s are back.”
10:35 AM BST
Warner: Tariffs based on highly questionable assumptions
Donald Trump has hit the world with a “full fat version” of his tariff plans which were higher than expected in many cases, our assistant editor Jeremy Warner reports.
Listen to his latest analysis of the President’s measures:
10:25 AM BST
Trump hammers Falkland Islands with 41pc tariff
Donald Trump imposed a 41pc tariff on goods from the Falkland Islands - significantly higher than the 10pc tariff he imposed on the UK.
The islands appeared to be hammered by the US president because of the trade imbalance between the two sides - despite the fact that the scale of the trade in the grand scheme of things is tiny.
The US exported goods with a value of $4.1m to the Falkland Islands in 2024, according to official data published by the United States Census Bureau.
But the US imported goods from the British Overseas Territory worth $22.8m.
10:19 AM BST
UK business optimism near two-year lows ahead of tariff announcement
Pessimism in Britain’s dominant services sector was among its highest levels in two years in the run-up to Donald Trump’s tariff announcement, a closely watched survey showed.
The S&P Global UK Services PMI index showed activity increased in March at its fastest pace since August last year.
However, S&P Global economics director Tim Moore said companies “reported a range of constraints on growth, including stretched household budgets, risk aversion among corporate clients and rising geopolitical uncertainty”.
He said: “Service businesses also remained cautious about the near-term outlook, with optimism still among the lowest seen over the past two years.
“Worries about increasing wages and the impact of forthcoming US tariffs were the most cited challenges in March.
“A combination of subdued order books and elevated input cost inflation led to cautious recruitment policies. Job cuts have now been recorded for six months in a row, reflecting a sustained period of hiring freezes and redundancies.”
10:04 AM BST
Chinese state media accuses Trump of ‘tariff tantrum’
Chinese state media has dubbed the new US policy as Trump’s “tariff tantrum” – and it is a tantrum with huge ramifications for the Asian superpower’s economy.
In an editorial on Thursday, the state-owned China Daily said the policy was like “an undersea earthquake that will create a tsunami of turbulence and trouble for the global economy”.
Beijing is far from immune. It has been hit by a 34pc tariff rate on almost all Chinese products, a decision that a spokesperson from the Ministry of Commerce described as “typical unilateral bullying practice”. It adds to the 20pc tariffs that came into effect earlier this year, giving it a total rate of 54pc.
The government department urged the US to “immediately cancel” the unilateral tariffs, and vowed to take “resolute counter-measures” to safeguard its own rights and interests.
Responding to the tariffs Jennifer Welch, chief geoeconomics analyst for Bloomberg Economics, said: “Put simply: if Trump’s prior 20pc tariff hikes took a hammer to US-China trade, today’s actions are a bazooka.”
Martin Chorzempa, senior fellow at the Peterson Institute for International Economics in Washington, added: “These tariffs will put China under enormous pressure.
“China’s retaliation to the latest two rounds was relatively muted, but today’s action could harden views in Beijing and lead to serious escalation far beyond tariffs.”
09:56 AM BST
Watch: Starmer warns Trump’s tariffs will have economic impact on Britain
09:53 AM BST
Shapps slams Trump for ‘reviving 19th century trade policy’
Grant Shapps accused Donald Trump of taking the US and the rest of the world “backwards” by imposing a wave of tariffs on foreign imports.
The Tory former defence secretary said the US president was adopting a “19th century trade policy” and compared it to swapping a modern mobile phone in favour of telegraph.
09:45 AM BST
European stocks hit by recession fears
European shares slumped to a two-month low as bank stocks bore the brunt of fears that Donald Trump’s trade war would slam the brakes on economic growth.
The Stoxx 600 - an index of companies from across Europe, including Britain - has sunk 1.3pc.
The rout was led by a slide of as much as 2.5pc on the Dax index in Germany, whose biggest trading partner last year was the US.
The Cac 40 in France was down as much as 2.2pc in early trading after the US president imposed 20pc tariffs on the EU, while China’s levies were raised to a total of 54. Both have vowed countermeasures.
Concerns about the impending tariffs’ impact on economic growth had already knocked the benchmark Stoxx 600 about 5pc lower from its early March record high and overshadowed optimism over Germany’s historic stimulus boost.
Emmanuel Makonga of Barclays Investment Bank said the tariffs have “tilted the mood towards recession expectations, which was not necessarily the case prior to that”.
He said: “It opens the probability for (the European Central Bank) to cut interest rates even faster in order to provide a little bit of boost with regard to sentiment.”
Eurozone banks, sensitive to the economic outlook, retreated 3.5pc as traders ramped up bets of ECB rate cuts despite the trade war threatening to stoke inflation.
The bank-heavy indexes in Italy and Spain fell 1.6pc and 1.1pc, respectively.
Among stocks, sporting goods makers Adidas and Puma tumbled 10.3pc and 9.1pc respectively after Donald Trump launched tariffs on their manufacturing suppliers in Southeast Asia.
Among luxury goods firms, Cartier owner Richemont, jewellery maker Pandora and LVMH fell between 2pc and 5pc, hurt by tariffs on EU and Switzerland.
09:29 AM BST
‘No justification’ for tariffs, says Irish PM
Ireland’s Taoiseach Micheál Martin said there was “no justification” for Mr Trump’s 20pc tariff on the EU.
“Tariffs drive inflation, hurt people on both sides of the Atlantic, and put jobs at risk,” he said.
Large US pharma companies have factories in Ireland, which is a major hub for drug exports.
Fears that Mr Trump would come up with a specific pharma tariff to onshore manufacturing jobs did not come to pass.
The tariffs could still cost Ireland more than £15bn in lost trade. Ireland had a record £41.8bn trade surplus with the US last year.
The days when Dublin could rely on having Joe Biden, a president fiercely proud of his Irish roots, in the White House are well and truly over.
09:23 AM BST
Meloni tells Trump tariffs are ‘wrong’
Giorgia Meloni may consider herself a friend and ally of Donald Trump but that has not stopped her from criticising the tariffs announced by the US President as “wrong”.
The Italian prime minister said that despite the imposition of 20pc duties on EU products, she will keep talking to Washington in the hope of striking some sort of better deal.
“The introduction of tariffs by the United States against the European Union is a measure that I consider wrong and that does not benefit any of the parties involved,” she said in a statement.
“We will do everything we can to work towards an agreement with the United States, with the goal of averting a trade war that would inevitably weaken the West to the advantage of other global players.”
Her deputy prime minister, Matteo Salvini, says he thinks imposing retaliatory tariffs would be a mistake.
Mr Salvini, the leader of the nationalist, hard-Right League and a fervent admirer of both President Trump and Vladimir Putin, said that any decision by the EU to “take revenge” for US tariffs would be “unfortunate”.
“With the Trump administration, it is necessary to negotiate, trade...taking revenge for companies is not a good starting point,” he said.
09:18 AM BST
Tiny Australian island hit with 29pc tariff
Australia’s prime minister has questioned the Trump administration’s decision to impose higher tariffs on one of its tiny islands.
Anthony Albanese said he was not sure why Norfolk Island was hit by a 29pc tariff, while mainland Australia faced a levy of 10pc.
Later a spokesman for the administrator of the tiny Australian island, which has a population of around 2,200 people, said it will not pay a higher tariff as it had “no known exports” to the US.
09:07 AM BST
Government borrowing costs plunge as investors switch to bonds
The cost of government borrowing has fallen sharply around the world as Donald Trump’s tariffs prompted investors to dump riskier stocks and switch to the safer returns of the bond market.
The 10-year UK gilt yield - a benchmark for the Treasury’s debt costs - has dropped nine basis points to 4.55pc, leading the falls among major European economies.
There were even sharper declines in Asia, with Japan’s 10-year bond yield down 11 basis points to 1.34pc, while Australia’s 10-year yield fell nearly 16 basis points to 4.26pc.
Scott Bessent, the US Treasury Secretary, has said the Trump administration aims to get down the cost of US debt by lowering the yield on its bonds.
Mr Trump’s tariffs helped push the US two-year yield to its lowest level since October, while the 10-year yield dropped to 4.07pc.
Analysts at Saxo said investors were eyeing “a weaker US economy from the tariff disruptions”.
Victoria Hasler of Hargreaves Lansdown added: “We’re bullish on bonds. Given the uncertainty in markets, and the potential for tariffs to increase inflation, rate cuts are likely to be slower than expected.
“But with the 10-year gilt and US Treasury yields both still above 4pc, bonds are still as attractive as they were at the start of the year.”
08:57 AM BST
Analysis: Britain faces international fallout from tariffs
Donald Trump overlooked Britain’s 20pc VAT rate when he imposed 10pc tariffs on the UK, having indicated that he may use the tax as a benchmark for his levies.
However, our US economics correspondent Melissa Lawford outlines why escaping the worst of the President’s direct tariffs does not mean Britain will escape the global fallout.
08:47 AM BST
UK will not retaliate now over Trump tariffs, signals Reynolds
Jonathan Reynolds all but confirmed the Government will not take immediate retaliatory action against the US after Donald Trump imposed 10pc tariffs on UK goods.
The Business and Trade Secretary said the Government needed to “keep available every potential tool, every potential option we have to respond”.
But he signalled the focus will remain on continuing talks with the White House in an attempt to remove the tariffs.
He told the BBC Radio 4 Today programme: “Whilst we are in a place where we could potentially not just alleviate what has been announced but actually get to a better place, the message from business to me this week, last week, very, very strongly has been ‘please remain engaged’.”
08:40 AM BST
Northern Ireland to be forced into EU retaliation
Britain may have benefited from a “Brexit dividend” when it escaped Trump’s trade war with the EU but Northern Ireland has not been so lucky.
The Windsor Framework, the region’s Brexit deal, means it will have to impose any retaliatory EU tariffs on US goods entering Northern Ireland, even if they come via Britain.
Mr Trump announced a 20pc tariff on the “pathetic” EU and hit Britain with a lower 10pc tariff. Brussels has warned it will respond with tariffs, if negotiations fail.
After imposing the higher EU tariff, Northern Irish traders can claim the money back from the UK government. They will need to first prove the goods stay in Northern Ireland and don’t cross the border into EU member Ireland.
It is by no means certain that businesses will go through that red tape or just simply pass the cost onto consumers, leading to higher prices in the UK’s poorest region.
Deputy First Minister Emma Little-Pengelly, of the DUP, said she will be “pushing for all possible action to protect Northern Ireland, especially against any retaliatory tariffs by the EU”.
But her options are limited and this risks further straining unionist patience with the Irish Sea border deal that many fear has put Northern Ireland’s place in the UK at risk.
08:33 AM BST
Trump’s Asia tariffs dubbed ‘geopolitical own goal’ as Xi to visit Vietnam
Southeast Asia is reeling after being hit hard by President Trump’s tariffs – a move some analysts have called a “geopolitical own goal”.
The US and China are jostling for influence in the region, which is already dealing with the fallout from cuts to USAID.
In Cambodia – where more than 17pc of the population is below the poverty line, according to the Asian Development Bank (ADB) – the US has announced a 49pc tariff rate.
Laos, a landlocked country home to 7.6 million people heavily bombed by America during the Vietnam war, now has a 48pc tariff. The ADB puts the poverty rate at 18.3pc.
Vietnam and Myanmar – a war-torn nation reeling from a powerful earthquake – are not far behind, with rates of 46pc and 44pc respectively.
Dr Khang Vu, a visiting scholar at Boston College, said on X: “The US slapping 46pc tariffs on Vietnamese products mere days before Chinese President Xi Jinping’s visit to Vietnam is such a geopolitical own goal.”
Elsewhere Indonesia, the biggest economy in the region, faces a 32pc tariff rate, Malaysia a 24pc rate, and Singapore a 10pc rate. In Thailand, where the US is the country’s biggest trading partner, there is a 36pc rate.
“The US is pretty much done strategically in Southeast Asia,” Evan Feigenbaum, vice president for studies at the Carnegie Endowment for International Peace, wrote on X.
“The region is filled with pragmatists, who can and do navigate all kinds of crazy stuff from outside powers. But that depends greatly on those players being either principled or strategic – and Washington is now neither.”
08:09 AM BST
Starmer vows to ‘fight’ for Trump trade deal
Sir Keir Starmer said he would “fight” to secure a deal with the US in the hope of mitigating the impact of the tariffs.
Addressing business chiefs including AstraZeneca’s Pascal Soriot, BAE’s Charles Woodburn and Jaguar Land Rover’s Richard Molyneux, the Prime Minister said: “Nobody wins in a trade war, that is not in our national interest.
“We have a fair and balanced trade relationship with the US.
“Negotiations on an economic prosperity deal – one that strengthens our existing trading relationship -they continue and we will fight for the best deal for Britain.”
He said he would only strike a deal with Donald Trump’s White House “if it is in our national interest and if it is the right thing to do for the security of working people, protects the pound in their pocket that they have worked hard to earn”.
08:04 AM BST
UK markets plunge at the open
The FTSE 100 plunged as trading began in London after Donald Trump announced tariffs on countries across the world.
The UK’s flagship stock index sank 1.7pc to 8,482.71 despite Britain being hit with 10pc tariffs which were among the lowest imposed by the US president.
The midcap FTSE 250 — which is more focused on the UK’s domestic market — fell 1.1pc to 19,383.85.
Business Secretary Jonathan Reynolds insisted the UK was in a “relatively better position” than the EU, which was hit with 20pc levies as Mr Trump upended the world order on global trade.
08:00 AM BST
Starmer: Britain is prepared for economic impact of tariffs
Sir Keir Starmer said one of Britain’s great strengths was the ability to “keep a cool head” after Donald Trump hit the UK with 10pc tariffs.
The Prime Minister insisted the Government was “prepared” but admitted to business chiefs in Downing Street this morning that there would be an “economic impact” from the decisions taken by the US president.
He said: “Last night the President of the United States acted for his country, and that is his mandate.
“Today, I will act in Britain’s interests with mine.”
Sir Keir said as the Government moved “to the next stage of our plan”, the “decisions we take in coming days and weeks will be guided only by our national interest, in the interests of our economy, in the interests of businesses around this table, in the interests of putting money in the pockets of working people”.
“Nothing else will guide me, that is my focus,” he said.
“Clearly, there will be an economic impact from the decisions the US has taken, both here and globally.
“But I want to be crystal clear: we are prepared, indeed one of the great strengths of this nation is our ability to keep a cool head.”
07:57 AM BST
UK and US still friends despite tariff row, says Cabinet minister
The US is still a friend of the UK despite Donald Trump’s decision to impose 10pc tariffs on British goods, a Cabinet minister has said.
Jonathan Reynolds, the Business and Trade Secretary, said the US remained the UK’s “principal ally”.
He made the comments after he was asked if he agreed with Anthony Albanese, the Australian prime minister, who said the imposition of tariffs by Mr Trump was “not the act of a friend”.
Mr Reynolds told Sky News: “America is a friend. American is our principal ally. Our relationship is an incredibly strong economic one but also a security one, a political one as well.
“I understand some of the concerns that actually do exist on both sides of the political divide in the US about the impact of trade policy, of economic policy on some parts of America over the last few decades.
“I think you have got to engage with that. We might not agree, and don’t agree, with all of these decisions but we have got to understand where they are coming from.”
07:49 AM BST
Brexit is why Britain was hit with smaller tariffs, say Tories
Brexit is the reason Britain dodged more severe punishment from Donald Trump rather than Sir Keir Starmer’s negotiations, according to the Conservatives.
Chris Philp, the shadow home secretary, said the Prime Minister was “far, far too slow” to start trade talks with the White House, he said, leaving the UK unprepared for the so-called liberation day tariffs.
“Dozens and dozens of countries have the 10pc tariff, which is not based on any sort of negotiating genius by the Government, it is based on the USA’s assessment of our tariffs and other obstacles,” Mr Philp told the BBC’s Today programme.
“Of course our cars, which is the largest goods sector we export, is going to be whacked with 25pc.
“And I would add that we are getting a lower rate than Europe because of Brexit and the fact that we can have separate tariff arrangements.”
He said restarting free trade talks with the US “should be a priority”, after the Conservatives began negotiations with Mr Trump’s first administration, before Joe Biden cancelled any prospect of a deal.
“We said back in November the UK Government, the Starmer Government, should be getting on with negotiating with the USA, to get a free trade deal, they have been very slow to do that,” Mr Philp said.
“The Business Secretary said Keir Starmer only raised it with Donald Trump a month or so ago, which is far far too slow. He was elected in November.”
07:46 AM BST
Taliban ‘got a better deal than Starmer’
Sir Keir Starmer has been accused of getting a weaker deal on US tariffs than the Taliban after Donald Trump imposed 10pc tariffs on Britain.
Afghanistan was also hit with the same 10pc levy, despite imposing higher levies on the US than Britain, according to the White House’s disputed formula for imposing levies.
“Even the Taliban got a better deal than Starmer,” an SNP official told Politico.
07:36 AM BST
FTSE 100 on track to open lower
The FTSE 100 was on track to drop sharply at the start of trading despite Britain being hit with among the lowest tariffs announced by Donald Trump.
The UK’s benchmark index was down 1.3pc in premarket trading, where European stocks were also down heavily.
France’s Cac 40 was 1.8pc lower while the Dax in Germany dropped 1.8pc.
07:29 AM BST
UK in better position than EU after Trump tariffs, says Reynolds
Jonathan Reynolds said the UK was in a “relatively better position” than the EU after Donald Trump unveiled his “liberation day” tariffs.
But the Business and Trade Secretary said he was still hoping to ultimately agree an economic deal with the US which would not only remove the new tariffs but also get rid of pre-existing trade barriers between the two countries.
Mr Trump imposed 10pc tariffs on the UK but 20pc on the EU.
Mr Reynolds told Sky News: “I recognise the announcements by the president last night put the UK in a relatively better position than for instance the EU.
“But to be clear, any imposition of trade barriers, tariffs in this case, between the UK and a major market like the US is a disappointment to me.”
He added: “Of course I am pleased the UK is in a better position than other countries but I am not satisfied. The job is not done, our engagement that we have had with the US has been important, we have got to continue that.
“We should be aiming for, and I am, a position that not only avoids the imposition of additional barriers on the UK but actually removes them.”
07:17 AM BST
Carmakers and banks hit as Asian stocks plunge
Asian markets tumbled following Donald Trump ’s announcement of big increases in tariffs on imports of goods from around the world.
Tokyo’s Nikkei 225 index dipped 4pc briefly, with carmakers and banks taking big hits. It closed down 3.3pc at 34,566.36.
Mitsubishi UFJ Financial Group’s shares plunged 8.3pc as the potential impact of the 24pc tariffs on the export-dependent Japanese economy dashed expectations that the central bank will keep raising interest rates.
Mizuho Financial Group skidded 9.2pc. Sony stocks sank 5.6pc and Toyota gave up 6.3pc.
In South Korea, which was hit with a 25pc tariff, the benchmark Kospi fell 1.1% to 2,478.49.
Hong Kong’s Hang Seng lost 1.9pc to 22,776.00, while the Shanghai Composite index edged less 0.2pc lower, to 3,342.39.
Yeap Junrong of IG said the announcement came as a “major shock”.
He said: “China, in particular, was hit with an additional 34pc tariff, bringing its total tariff burden to 64pc when accounting for previous measures.”
In Australia, the S&P/ASX 200 fell 0.9pc to 7,859.70. Bangkok’s SET shed 1pc after Thailand was assigned at 36pc tariff on its exports to the US.
07:04 AM BST
Pictured: Stocks tumble across the globe
Stocks have dived around the world as Donald Trump’s trade war sent investors scrambling for the safety of bonds, gold and the yen.
Olu Sonola, head of US economic research at Fitch Ratings, said: “This is a game-changer, not only for the U.S. economy but for the global economy.
“Many countries will likely end up in a recession. You can throw most forecasts out the door if this tariff rate stays on for an extended period of time.”
06:50 AM BST
Foreigners dump Japan stocks over tariff fears
Foreigners have sold Japanese stocks for nine consecutive weeks in the longest selling run in three years over concerns that US reciprocal tariffs could disrupt exports.
Donald Trump announced a higher-than-expected 24pc tariff on Japanese goods on Wednesday, while a previously imposed 25pc tariff on car imports took effect overnight in a major blow to the auto industry in the world’s fourth-largest economy.
Foreigners sold Japanese stocks worth 450.4 billion yen (£2.3bn) on a net basis in the week to March 29, according to data from Japan’s Ministry of Finance.
In the nine straight weeks of net selling that began on January 26, foreigners have withdrawn 6.47 trillion yen compared with just 3.89 trillion yen worth of total net withdrawals in March 2022, the last nine-week-long selling streak.
The country’s benchmark Nikkei stock market has tumbled as much as 4.6pc to an eight-month low of 34,102.00 today.
Analysts have warned of further pressure as a stronger yen threatens to weigh on exports. The Japanese currency has surged as investors consider it a safe-haven asset.
06:36 AM BST
Starmer to speak to businesses as tariffs deliver ‘major blow’
The Prime Minister is expected to speak to business leaders later today after Donald Trump slapped a 10pc tariff on US imports of UK goods.
Sir Keir Starmer is expected to meet with businesses after warnings from the Federation of Small Businesses (FSB) that the levies will deal a “major blow” to UK firms.
No immediate retaliatory measures are expected from Westminster, as officials continue to focus on securing an economic deal with their counterparts in Washington.
Jonathan Reynolds is due to address MPs on Thursday morning after Mr Trump confirmed sweeping import levies on countries across the world, hailing America’s “declaration of economic independence”.
He said on Wednesday evening that the UK is still seeking to do a deal with the US that “we hope will mitigate the impact” of the tariffs, but that “nothing is off the table” when it comes to a response.
06:28 AM BST
South Korea seeks talks with US
South Korea’s acting president called for talks with the US after Donald Trump announced it faced levies of 25pc on its exports to America.
Han Duck-soo asked the industry minister to analyse the content of the tariffs and actively negotiate with Washington to minimise the impact, an industry ministry statement said.
“As the global trade war has become a reality, the government must pour all its capabilities to overcome the trade crisis,” Han said at a meeting with the finance minister and other top officials.
The industry ministry said Seoul will pursue consultations with both senior and working-level US officials on tariffs.
Trump in his speech singled out Washington’s Asian security allies South Korea and Japan, accusing them of being among the worst offenders for conducting unfair trade practices against the United States.
Analysts in Seoul said Trump’s extensive rollout of tariffs was harsher than expected.
Park Sang-hyun, an economist at iM Securities, said: “For the domestic economy, a significant blow will be inevitable.”
06:18 AM BST
Thailand PM has ‘strong plan’ to tackle tariffs
Thailand has a “strong plan” to handle the new trade tariffs imposed by Donald Trump and hopes to negotiate a reduction, its prime minister said.
Paetongtarn Shinawatra said the government would take steps to mitigate the impact of the 36pc levy announced by Washington as part of sweeping tariffs that have sent global markets reeling.
Southeast Asian countries with a significant trade surplus with the United States came in for harsh treatment from Mr Trump, with Vietnam being hit with a 46pc tariff and Cambodia 49pc.
“We have a strong plan,” Ms Paetongtarn told reporters.
“We have prepared several steps, including sending our permanent secretary to talk with them... I think we can still negotiate.”
06:01 AM BST
Pound surges as Trump tariffs hit the dollar
The value of the pound tipped above $1.30 for the first time since October as Donald Trump’s tariffs weakened the dollar against major currencies.
Sterling rose 0.5pc to $1.306 after the US president announced more aggressive-than-expected tariffs against America’s trading partners. The pound was worth $1.298 before Mr Trump started speaking on Wednesday.
Investors instead turned to safe-havens like the yen or the Swiss franc after Mr Trump said he would impose a 10pc baseline tariff on all imports to the US from April 5. Higher duties on about 60 of the country’s biggest trading partners will take effect on April 9.
The euro, meanwhile, initially surged following the tariff announcements and was last up 0.7pc against the dollar at $1.091. It was up 0.3pc versus sterling, making it worth 83.5p.
Kyle Rodda, senior financial market analyst at Capital.com, said: “The markets are in risk-off mode and pricing in weaker global economic growth.
“The issue for markets in the coming days will be clarifying whether there’s scope for trading partners to re-negotiate these tariffs and whether there is the risk further trade restrictions are possible from here.”
05:09 AM BST
Gold soars to record high
Gold climbed to a record high after Mr Trump’s sweeping tariffs were announced.
Bullion was one of the few commodities exempted from the tariffs, according to a White House fact sheet.
The metal’s haven status was underlined when it rose as much as 1.1pc in Asian trading after the president’s address, before it pared some gains. That followed a 0.7pc increase on Wednesday.
05:07 AM BST
Tariffs ‘very unreasonable’, says Taiwan
Taiwan’s cabinet called Mr Trump’s reciprocal tariffs “very unreasonable” and said it would take up the matter with the US.
The proposed tariff rate does not reflect the actual situation of Taiwan-US trade, the cabinet said on Thursday.
05:05 AM BST
Trump’s top economist: Short-term bumps ‘expected’
Short-term “bumps” as a result of the new tariffs are expected, the president’s top economist has said.
Council of Economic Advisers Chair, Stephen Miran, told Fox Business on Wednesday that the tariffs would work out well for the US in the long run, even if they caused some initial disruption.
“Are there going to be short-term bumps as a result? Absolutely,” he said.
“But what the president is focused on is a long-term transformation and improvement in the durability, sustainability and fairness of the American economy with respect to the rest of the world.”
04:49 AM BST
Watch: EU chief’s statement
04:41 AM BST
EU prepared to hit back with countermeasures
Ms Von der Leyen said the EU was prepared to respond with countermeasures if negotiations failed.
“We are already finalising the first package of countermeasures in response to tariffs on steel,” she said.
“And we’re now preparing for further countermeasures to protect our interests and our businesses if negotiations fail.”
04:27 AM BST
Von der Leyen: Tariffs are a ‘major blow’ to world economy
The president of the European Commission has said Donald Trump’s tariffs are a “major blow” to the world economy.
Speaking moments ago, Ursula von der Leyen said the consequences of US president’s plan “will be dire for millions of people around the world”.
Ms Von der Leyen is in Samarkand, Uzbekistan, where she will join the EU-Central Asia summit later today.
04:19 AM BST
What world leaders said overnight
04:15 AM BST
The key points
Hailing April 2 as “liberation day”, Donald Trump has for weeks promised to implement a range of fresh tariffs on America’s trading partners, upending the global markets.
Speaking in the White House rose garden, Mr Trump announced a 10 per cent baseline tariff for all US trading partners, due to come into force on April 5.
He also announced reciprocal tariffs against the “worst offenders”, which will take effect from April 9.
Read more: The five key takeaways from Donald Trump’s tariff announcement
03:43 AM BST
Japan: Tariffs could breach WTO rules
Japan has said that Donald Trump’s sweeping global tariffs may contravene World Trade Organisation (WTO) rules and the two countries’ trade treaty.
“We have serious concerns as to consistency with the WTO agreement and Japan-US trade agreement,” chief cabinet secretary Yoshimasa Hayashi told reporters.
Last night Mr Trump hit Japan with a 24pc tax on imports.
03:42 AM BST
Volkswagen ‘to introduce import fee’
Volkswagen will introduce an “import fee” on vehicles affected by the 25pc tariffs imposed by Donald Trump, it has been reported.
The German carmaker has temporarily halted rail shipments of vehicles from Mexico and will hold at port cars arriving by ship from Europe, the Wall Street Journal reported, citing a memo to retailers.
Germany’s Automotive Industry Association (VDA) has this morning called on the EU to respond to Mr Trump’s tariffs with “force”, declaring they “will only create losers”.
“The EU is now called upon to act together and with the necessary force, while continuing to signal its willingness to negotiate,” the body said in a statement.
The body represents the German auto industry, for which the US is a key export market.
03:23 AM BST
Watch: Trump announces reciprocal tariffs
03:22 AM BST
5 things to start your day
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Aston Martins to Scotch: The sectors hit hardest by Donald Trump’s tariffs | Some of Britain’s most important industries are highly exposed to Washington’s trade war
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Starmer wants to appease Trump. Doing so will spell disaster for Reeves | The PM’s hopes of placating the White House could upend the Chancellor’s finances
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Amazon bids to buy TikTok after Jeff Bezos courts Trump | Social media app’s owner ByteDance must sell its US operations by Saturday
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Jeremy Warner: Trump wants to rescue US jobs but ‘America first’ will backfire | Some of the biggest victims of the president’s protectionism will be his own voters
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Musk prepares to leave the White House | Tesla billionaire set to step back from job as a ‘special government employee’
03:11 AM BST
How Wall Street fared last night
Last night, the S&P 500 closed up 0.7pc, but only after careening between an earlier loss of 1.1pc and a later gain of 1.1pc.
The Dow Jones Industrial Average added 0.6pc, and the Nasdaq Composite climbed 0.9pc. Both also veered from sharply lower in the afternoon to sharply higher in the evening before doubling back.
Treasury yields swung in the bond market, echoing the indecision seen in the stock market.
The yield on the 10-year Treasury fell as low as 4.11pc in the morning from 4.17pc late on Tuesday and from roughly 4.8pc early this year.
03:01 AM BST
New tariffs at a glance
03:00 AM BST
Good morning
Donald Trump has announced tariffs of 10 per cent on the UK as part of a “declaration of economic independence” by the US.
Britain managed to avoid the worst of the US president’s measures – which he announced on the lawn at the White House last night – but our European friends did not.
The US will slap a 20pc levy on imports from the EU and a 34pc tax on the same from China.
In addition, his plans to impose 25pc tariffs on all foreign car imports came into effect at 5am UK this morning.
Follow all the reaction and latest developments throughout the day in our live blog.