Neighbours Targeted with Tariffs
Donald Trump recently declared a trade war on US neighbours, announcing plans for 25% tariffs on Mexican and Canadian goods. The move sent the dollar soaring in response.
Reasons Behind the Tariffs
The President-elect stated that the tariffs would be in place until the countries take action to stop the flow of illegal drugs and migrants into America.
Global Impact
Trump also mentioned imposing an additional 10% tariff on imports from China upon his return to the White House. However, Britain and Europe were spared from this announcement.
Retaliatory Measures
Despite being spared, British ministers are reportedly preparing retaliatory levies on imports such as Jack Daniel’s whiskey, Levi’s jeans, and Harley-Davidson bikes.
Financial Market Reactions
In response to the news, the FTSE 100 slumped, with the London index falling 33.07 points. The Mexican peso and Canadian dollar also experienced significant drops in value.
Potential Cost to Consumers
Bank ING warned that these tariffs could potentially cost US consumers up to $2,400 per capita annually, raising concerns about the economic impact of the trade war.
