Business Reporter, BBC News
Pictures of gettyStock market markets around the world fell after the introduction of President Donald Trump’s rates on goods entering the United States from China, Canada and Mexico.
Trump has imposed 25% of rates on Imports of Canada and Mexico and 20% of rates against China.
Canada and China announced their own US merchandise taxes, while Mexico said he had « contingency plans », causing fears of the complete trade war.
The three main stock market rates in the United States sank after the news, while the FTSE 100 of the largest companies in the United Kingdom opened on Tuesday and also reduced the stock market markets in Asia.
Analysts have warned that rates could increase prices for homes in the United States and could also have a shocking effect on consumers around the world, including in the United Kingdom.
The CEO of the North retail -American -American warned that buyers could see prices increase over the next two days.
Brian Cornell said at CNBC prices for food, including strawberries, avocados and bananas.
Ford’s CEO Jim Farley warned last month that the business « could deal with two weeks of rates ».
Said to Bloomberg: « We could see billions of dollars of pressure on the industry, lost jobs, many impacts on communities. »
Trump threatened to impose the rates, which is a tax added to a product when he enters a country: in Canada, Mexico and China in response to claims that is the unacceptable flow of illegal drugs and illegal immigrants in the United States.
But the Canadian Prime Minister, Justin Trudeau, said that his country was responsible for less than 1% of the Fentanyl entering the United States and that it was retaliated with 25% of rates with North -150 million American products.
« There is no justification for actions in the United States … Canada will not let this unjustified decision not answer, » Trudeau said in a statement on Monday.
He said that Canada would first address products worth 30 million dollars, and the goal of the remaining $ 125 million for 21 days.
All new functions that Canada imposes will be underway « until the United States commercial action is removed, » he added that his country would pursue « non -tariff measures » in the event that the United States fares did not cease, without specifying what these measures were.
“Trade war”
China rapidly announced its own contrast measures, including 10-15% rates in some agricultural assets in the United States, such as wheat, corn, beef and soybeans. China is the largest buyer in the United States of these goods.
« If the United States … they persist to a fare war, a trade war or any other type of war, the Chinese side will fight until the bitter end, » said Lin Jian’s spokesman for Foreign Affairs.
Before the United States rates to Mexican imports came into force, President Claudia Sheinbaum said that her country had contingency plans.
« In this situation, we need composition, serenity and patience. We have plan A, Plan B, Plan C and even the D Plan, » he said.
Sheinbaum said he would talk more about Mexico’s response on Tuesday.
In the US, the Dow Jones closed 1.5% lower and the S&P 500 ended the day, it dropped by 1.8% on Monday, while in Asia on Tuesday, Nikkei 225 closed 1.2% lower and the Hang Seng index ended with 0.3%.
The FTSE 100 in London was lower in early negotiation, while the main bags in Germany and France also fell.
Trump has argued that the rates promote manufacturing and protect jobs, as well as increase tax revenue and grow the economy.
However, these measures may have detrimental effects on both consumers and companies, including those that were proposed to protect.
Buyers can be those that carry most of the rates in the form of higher prices, if transmitted, as well as less options.
In the meantime, rates often trigger retaliation from directed countries, disadvantaged to national companies seeking to export goods, which means that measures can retain trade, created jobs and economic growth.
“World Economic Risks”
Assets worth $ 2 million cross the borders of the United States, Canada and Mexico every day and their economies are deeply integrated.
With the introduction of rates in this cross -border trade, companies that matter goods could decide to convey some or all additional costs to consumers by increasing prices.
They could also reduce imports, which would mean less products and, therefore, a higher demand, which could also increase prices.
Andrew Wilson, from the International Chamber of Commerce, said: « What we are seeing is the greatest effective increase in United States rates since the 1940’s, with serious economic risks to this. »
« The initial market movements are completely reflective that we are now entering a very risky scenario for global trade and for the global economy, » he told the Today BBC Radio 4 program.
He said that the University of Yale had planned that these measures could cost North -Americans in the region of $ 2,000 only this year.
The price increases
TD economics analysis has suggested Cars could get up at the price for about $ 3,000.
This is because the parties cross the borders of the United States, Canadians and Mexicans several times before a vehicle meets.
North consumers -Americans could also see that the price of avocados increases, as Mexican avocados represent almost 90% of the United States avocado market each year.
The maple of $ 1 billion maple syrup of Canada accounts for 75% of the world’s entire maple syrup production, so American households could see prices to increase sweet.
She, Hoxha, head of Newton Investment Management’s fixed revenue, said to the BBC: « In terms of consumers, it is more likely that in the short term, prices will be increased in the short term as companies pass some of these consumer prices. »
Chris Torrens, Vice President of the British Chamber of Commerce in China, added: « It is a huge challenge for British business due to the historical links that the United Kingdom and the United States have.
« But there is a real sense of hope for a stronger relationship in the United Kingdom. »
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