Donald Trump’s tariffs are already shaking global markets, but whether they spark a full-scale recession remains to be seen. We want to know if you think we’re heading for a global economic downturn.
Donald Trump’s wildly unpredictable trade tariff war has sparked real fears we’re heading for a global recession.
The US President’s decision to increase tariffs on all steel and aluminium imports to 25% has sent shockwaves across the markets, sending business and consumer confidence plunging.
He says the latest taxes will help create factory jobs across the US but his seesawing tariff threats have jolted the stock market and raised fears of an economic slowdown. The trade wars have even caused the wealth of some of the richest people on the planet – including Elon Musk – to tumble.
The potential for such tariffs to spark a worldwide recession is a complicated issue, particularly when on such a large scale. They certainly have the capacity to disrupt global supply chains, increase the cost of goods, and reduce international trade volumes, all of which could have negative effects on the global economy.
Trump’s controversial trade policies have already led to tensions in international markets, with immediate consequences having the potential to include retaliatory tariffs, higher prices for consumers, and uncertainty for businesses that rely on global supply chains.
The UK steel industry says the world leader’s tariffs “couldn’t come at a worse time” as it is thought the UK government is unlikely to immediately retaliate to the huge import tax.
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Mr Trump told CEOs in the Business Roundtable on Tuesday the tariffs were causing companies to invest in US factories. The 8% drop in the S&P 500 stock index over the past month on fears of deteriorating growth appears unlikely to dissuade him, as Mr Trump argued higher tariff rates would be more effective at bringing back factories.
The President on Tuesday threatened to put tariffs of 50% on steel and aluminium from Canada, but he chose to stay with the 25% rate after the province of Ontario suspended plans to put a surcharge on electricity sold to Michigan, Minnesota and New York.
Nevertheless, the move has been branded “hugely disappointing” by Gareth Stace, the director general of trade association UK Steel. He added: “President Trump must surely recognise that the UK is an ally, not a foe. Our steel sector is not a threat to the US but a partner to key customers, sharing the same values and objectives in addressing global overcapacity and tackling unfair trade.
Back here, the Prime Minister’s official spokesman said the government was “engaging closely with the US and we remain prepared to defend the UK’s national interest where it’s right to do so”.
What do you think? Do you think Trump’s tariffs will spark a worldwide recession? Take our poll above and expand on your feelings in the comments
