April 2, 2025 - Liberation Day tariff announcements

Our live coverage of President Donald Trump’s moves on tariffs and more has moved here.

Stock markets across Asia-Pacific and Europe fell Thursday and US markets were also set to open lower after US President Donald Trump announced new tariffs on trading partners around the world.

Japan’s benchmark Nikkei 225 index closed 2.8% down, while South Korea’s Kospi index closed less than 1% lower. Hong Kong’s benchmark Hang Seng Index closed 1.5% down.

In Europe, the region’s benchmark Stoxx 600 index was trading 1.3% lower at 5.22 a.m. ET, while France’s CAC was 2.1% down. London’s FTSE 100 had fallen 1.3% by the same time.

Falling US stock futures also pointed to a difficult day ahead.

Dow futures were 2.5% down and S&P 500 futures 3% lower. The tech-heavy Nasdaq was set to open 3.3% lower.

The DAX Index yield curve displayed on a screen at the Frankfurt Stock Exchange in Germany, on Thursday.

Stock markets in Europe fell Thursday after US President Donald Trump announced new tariffs on trading partners around the world.

The region’s benchmark Stoxx 600 index was trading 1.2% lower by 5 a.m. ET, while France’s CAC was 1.6% down. London’s FTSE 100 had fallen 1.2% by the same time and Germany’s DAX index was flat.

Trump’s announcement Wednesday included 20% tariffs on imports from the European Union. The EU is preparing countermeasures.

U.S. President Donald Trump, accompanied by White House staff secretary Will Scharf, signs executive orders imposing tariffs at the White House on Tuesday.

President Donald Trump has announced sweeping tariffs of at least 10% on most goods coming into the US.

Here’s how countries are responding.

This post was updated with more reaction from international leaders.

Small businesses in the US will be “bearing the brunt” of constantly changing tariff policies that are forcing them to raise prices for consumers, a CEO told CNN.

Adam Leeb, co-Founder of Astrohaus, which designs smart typewriters, said he and other small firms had been facing a whiplash of “policies that are changing day by day,” despite their operation requiring them to plan up to 18 months ahead.

He also said some of the tariffs the Trump administration had introduced had nothing to do with trade deficits but about combatting fentanyl trafficking and illegal immigration.

“There’s just so many different factors here, and it’s a lot of changes all at once,” Leeb said.

The CEO also said small businesses operated in competitive markets and would have to raise prices due to the costs incurred.

“There’s really no way around it,” he said, adding that both consumers and businesses were “in for some tough times” ahead.

People shop at a Target store on Wednesday in the Flatbush neighborhood in New York.

The US tariffs unveiled on “Liberation Day” are expected to cost each American household $5,000 per year, dealing a huge blow to working and middle-class families, an economist told CNN.

Economics professor Justin Wolfers from the University of Michigan said the cost of living is also expected to go up by 6% as businesses pass extra costs incurred onto consumers.

“That’s going to turn up in prices pretty much as soon as tomorrow,” he said.

Overseas, Wolfers said poor countries — such as Papua New Guinea and Fiji — would suffer from “damaging effects,” Wolfers said, calling Trump’s tariffs “evil.”

“The idea that they are any threat to Americans is just absurd,” he said.

Rich economies, meanwhile, appear to be banding together to retaliate, leaving the US alone. “All that President trump has managed to do is isolate Americans from the rest of the global economy,” he said.

He also said it would be “nonsense” to suggest Trump’s tariffs are reciprocal in nature given most industrialized economies impose low tariffs.

Some of US President Donald Trump’s most punishing tariffs will target the world’s poorest and most vulnerable countries, including those in the throes of deadly civil wars and emerging from suffocating economic crises.

Five countries singled out by the US for tariffs above the 10% minimum — the Democratic Republic of the Congo (11%), Madagascar (47%), Mozambique (16%), Malawi (18%) and Syria (41%) — are among the world’s 26 poorest economies. Collectively, these economies are responsible for just 0.5% of global output and income but are home to nearly 40% of the world’s poor, according to the World Bank.

In Madagascar, an island of about 25 million people off the coast of Southern Africa, more than 80% of the population lives in extreme poverty and survives on less than $2.15 per day.

Its exports to the US, its second-largest export market, totaled almost $800 million in 2024, consisting of mainly vanilla, apparel, titanium and cobalt.

Venezuela (15%), which also suffered from an economic collapse and humanitarian disaster, relies on the US as its biggest trading partner. The US imported $6 billion worth of goods from the South American country in 2024.

Among other countries singled out with the highest tariff rates is Myanmar (44%), a Southeast Asian nation recently hit by a massive earthquake that has killed more than 3,000 people. The country has also been embroiled in civil war for four years. Sparked by a military coup, the fighting has seen junta forces battle rebel groups across the country.

President Donald Trump delivers remarks on tariffs in the Rose Garden oof the White House on Wednesday.

The Trump administration is using tariffs as a tool to dismantle levies imposed by other countries and create “truly free and open global trade,” a director with The Heritage Foundation, a conservative think tank, told CNN.

Richard Stern, director of Grover M. Hermann Center for the Federal Budget at The Heritage Foundation, said other countries have deployed trade barriers, subsidized their products and committed intellectual property theft.

Some context: The Heritage Foundation is a leading conservative think tank with long roots in Washington and had a major role in organizing Project 2025, the conservative blueprint for US President Donald Trump’s second term in office.

Leading economists have told CNN they feared the tariffs could lead to a global recession if they aren’t quickly pulled back.

President Donald Trump’s historic tariff announcement will have a lasting impact on South Asia, where the US is a top export destination for many countries in the region, analysts say.

The region – which includes the world’s most populous country, India, as well as Pakistan, Bangladesh and Sri Lanka – is “dealing with varying levels of economic stress,” he said.

“There’s a lot of vulnerability, and the tariffs will hit hard,” said Michael Kugelman, South Asia Institute Director at The Wilson Center, a US-based think tank.

Trump imposed the highest tariffs in the region on Sri Lanka, at 44%. The island nation is still recovering from an economic crisis that contributed to the toppling of its government. It is now dependent on a bailout from the International Monetary Fund (IMF).

Bangladesh, which has a major garment industry, is also expected to grapple with economic pressure after Trump placed 37% tariffs on imports from there.

The US has historically been a top destination for Bangladesh’s garment exports. Trump’s announcement could reduce the competitiveness of the industry, affecting jobs in the sector.

India was slapped with some of the highest tariff rates for a major US trading partner, but at 26%, was not hit as its Asian peers.

New Delhi “made many earlier concessions to Washington to try to shield itself, but it didn’t work,” said Kugelman. Its “saving grace” now is a bilateral trade deal it’s negotiating with the US, he added.

Praveen Khandelwal, a politician from India’s ruling party and head of the Confederation of All India Traders, said the government would “talk to the Trump administration about how to ensure a minimal impact on the trade between America and India.”

Cattle stand in their holding yards at a slaughterhouse in Cooma, Australia, in October.

The 10% tariffs that President Donald Trump slapped on Australia will hurt Americans who love beef from its Pacific ally, an economist told CNN.

Richard Denniss, executive director of The Australia Institute, explained that Australia doesn’t export a large amount of beef to the US and would likely divert exports to other countries that impose lower tariffs.

“If they now want to pay more for it… That’s a ‘them’ problem, not an Australia problem.”

But he warned of the tariffs’ implications on the close ties between allies, saying that the US has essentially “ripped up” a free-trade agreement with Australia.

“The US has just shown itself to be an unreliable partner,” he said.

An analyst has likened President Donald Trump’s tariffs to gambling on “a global poker playing table,” warning of shaky times to come.

“It is a high-stakes game,” she told CNN’s John Vause, adding that it would rock markets.

Foroohar said the move would win the president support from auto workers back home —but hit allies.

Europe is going to come back with a “strong response,” she predicted, while reactions in developing markets may vary, she said, depending on how much they lean on the US for economic security.

The analyst also differentiated Trump’s tariffs during his first administration from the present one, saying previously the taxes were targeted, focusing primarily on China.

“I think it will certainly be the defining moment of his presidency. I’m hoping it doesn’t push the US and the world into recession,” she added.

Charts that show the tariffs the US is charging other countries, in the James Brady Press Briefing Room of the White House on Wednesday.

President Donald Trump’s tariffs are “highly unreasonable and regrettable,” Taiwan’s cabinet said, as it vowed to lodge solemn representations with the United States.

Taiwan, a major exporting economy and electronics manufacturer, was slapped with 32% tariffs by the Trump administration. But its vital semiconductor industry was exempted.

Some context: Home to the world’s largest contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC), the island is a key link in the global technology supply chain for companies such as Apple and Nvidia.

The calculation of the tariff rate “lacks scientific basis” and fails to reflect the highly complementary trade relationships between the two sides, Taiwan’s cabinet – the Executive Yuan – said.

Taiwan’s trade surplus with the United States has grown in recent years, in part due to rising demand from US companies for AI-related and information products.

“This reflects Taiwan’s huge contribution to the US economy and national security, but it was used as a reason to subject Taiwan to high tariffs,” the cabinet said.

Taiwan’s cabinet has instructed the Office of Trade Negotiations to demand an explanation from the US Trade Representative, adding it will continue to engage with US officials to safeguard Taiwan’s interests.

The imposition of US tariffs on South Korea will be particularly difficult for Seoul to manage effectively while the country is going through unprecedented political turmoil, says Park Sang-in, a professor of economics at Seoul National University.

On Friday, the country’s top court will decide whether to uphold the impeachment of President Yoon Suk Yeol – who faces charges of instigating an insurrection following his short-lived martial law order last December – or reinstate him to office.

There is no doubt that the tariffs are bad for South Korea’s economy, Park told CNN on Thursday, just hours after Trump announced 25% tariffs on US imports from South Korea, a longtime US ally.

Some background: South Korea and the US have a free trade agreement, also known as the Korea Free Trade Agreement (KORUS), in place, but the Trump administration has imposed tariffs on South Korea differently from other free trade partners, such as Canada and Mexico.

Park said Seoul should push back strongly on US tariffs, enhance regional cooperation and diversify its trade partnerships.

European flags waving outside the EU headquarters in Brussels on March 19.

The European Union is preparing countermeasures to US President Donald Trump’s announcement of 20% tariffs on imports from the bloc, which it called a “major blow to the world economy.”

The EU is a major US trading partner. Last year, it was the largest single market for US goods exports, ahead of America’s neighbors Canada and Mexico, based on figures from the United States Census Bureau.

Trump on Wednesday launched a historic global trade war, announcing sweeping global tariffs on dozens of nations, from Nicaragua to Cambodia. The tariffs come on top of previously imposed taxes on imports of steel, aluminum and cars.

While the European Union would prefer to work with the US to reduce trade barriers, “Europe is ready to respond,” she said.

Japan, a US treaty ally and key trading partner, has described President Donald Trump’s tariffs as “extremely regrettable” but did not announce any immediate retaliation or countermeasures.

Hayashi said Japan was examining whether the decision to impose 24% tariffs on Japanese exports breaches World Trade Organization rules and the Japan-US Trade Agreement, which was signed with the first Trump administration in 2019.

Trade minister Yoji Muto told reporters that Trump’s levies “would weaken the capacity of Japanese companies to invest in the US, having a negative impact on the US economy as well.”

Japan’s benchmark Nikkei 225 index tumbled nearly 4% at the open Thursday, reaching an eight-month low.

Limited options: Japan generally eschews direct confrontation diplomacy and had been lobbying hard behind the scenes with the Trump administration.

Analysts say Tokyo’s hands are somewhat tied by how reliant it is on US security guarantees in a tricky neighborhood.

“I think the biggest limitation Japan faces is that it’s next to China and North Korea, and it relies on America immensely for its security,” Jeffrey Hall, lecturer at the Kanda University of International Studies, told CNN.

Lodging a complaint to WTO could avoid direct confrontations.

New Zealand's Prime Minister Christopher Luxon speaks to the country's Parliament in Wellington, New Zealand, on January 28, 2025.

New Zealand Prime Minster Christopher Luxon has said the tariffs announced by the US are “not good for global economics.”

New Zealand is among a group of nations that will face a baseline 10% tariff.

Foreign Minister Winston Peters cut a more optimistic figure within New Zealand’s cabinet, arguing the US announcement was cause for “celebration,” because other countries have it worse.

New Zealand has ruled out imposing reciprocal tariffs on the US. But Wellington is disputing the US claim that New Zealand imposed 20% tariffs on US goods, a figure that appeared in a list presented by US President Donald Trump as he announced the tariffs. McClay said the figure is closer to 17%.

ANZ Chief Economist Sharon Zollner told CNN the tariffs alone would not be a game-changer for New Zealand exporters, but there could be indirect impacts.

An electronic stock board displayed inside the Kabuto One building in Tokyo, Japan, on Thursday.

Asian markets tumbled Thursday as investors reacted to US President Donald Trump’s announcement of sweeping global tariffs, which included hefty tariffs targeting many Asian countries.

Meanwhile, gold hit a new record high just above $3,160 an ounce according to Reuters, as investors rushed to the precious metal, traditionally seen as a safer financial bet.

Japan’s benchmark Nikkei 225 index tumbled nearly 4% at the open Thursday, reaching at eight-month low, as the country braced for 24% tariffs on exports to the US.

Hong Kong’s benchmark Hang Seng Index was down about 1.15% Thursday morning after the US announced a new 34% tariff on China, bringing the total US tax on Chinese goods to a whopping 54%.

South Korea’s Kospi stock market index was last trading about 1% lower after falling 3% at the open. Its imports to the US will face a 25% levy.

Australia’s ASX 200 dropped 142 points, or 1.79% when it opened Thursday after Trump’s decision to impose a 10% tariff on the country’s exports. Markets in Taiwan were closed Thursday.

Vietnam’s benchmark VN Index fell more than 5% in early trade, according to Bloomberg News. The gauge is poised to erase its year-to-date gains.

President Donald Trump’s massive tariffs announced on dozens of nations Wednesday were pitched as “reciprocal,” matching what other countries charge the United States dollar for dollar, even taking into account non-tariff barriers like value-added taxes and other such measures.

But the actual calculation the Trump administration seems to have used appears as though it is not reciprocal at all.

Matching countries’ tariffs dollar for dollar is an incredibly difficult task, involving pouring over each country’s tariff schedule and matching a complex array of products, each of which take different charges for different variants.

Instead, the Trump administration seems to have used quite a simple calculation: the country’s trade deficit divided by its exports to the United States times 1/2. That’s it.

The calculation was first suggested by journalist James Surowiecki in a post on X and backed up by Wall Street analysts.

For example, America’s trade deficit with China in 2024 was $295.4 billion, and the United States imported $439.9 billion worth of Chinese goods. That means China’s trade surplus with the United States was 67% of the value of its exports — a value the Trump administration labeled as “tariff charged to USA.”

But it was no such thing.

The simple calculation used by the Trump administration could have broad implications for countries America depends on for goods — and the global companies that supply them.

“Knowing how these rates were calculated highlights that they are generally going to be most severe on the nations that US companies rely heavily upon in their supply chain,” O’Rourke said. “It is hard to imagine how these tariffs would not wreak havoc upon the profit margins of major multinational corporations.”

An expected hike in vehicle prices would hit American consumers so fast and hard that even better-off clients would not be able to keep up with the spike, a Pennsylvania car dealership owner told CNN.

President Donald Trump said the US would impose 25% tariff on all foreign automobiles in what he called “horrendous imbalances” that have impacted the country’s “industrial base” and put national security at risk.

It’s Trump’s move to bring more auto manufacturing back to America, but local car dealers are warning against a price hike. The tariff announcement has also caused unease among allies who export cars to the US, including Japan and South Korea.

David Kelleher, president of David Auto Group, said a $30,000 car may become $37,500, meaning that his clients could be asked to fork out $175 more per month.

“Our customers … are middle class people. They just can’t afford that kind of bump,” Kelleher said.

Correction: This post has been updated to correct Kelleher’s quoted figures

If President Donald Trump maintains the massive tariffs he announced today, his unprecedented trade policies will probably cause both the US and global economies to fall into a recession in 2025, JPMorgan analysts said in a note to investors.

That’s not exactly a shock: Prior to Trump’s universal and reciprocal tariff announcements today, JPMorgan analysts gave the US economy a 40% shot of entering a recession.

JPMorgan noted that the tariffs would hike taxes on Americans by $660 billion a year, the largest tax increase in recent memory by a longshot. It will cause prices to surge, too, adding 2% to the Consumer Price Index, a measure of US inflation that has struggled to come back down to earth in recent years.

The shock will be exacerbated by plunging consumer and business sentiment and by any retaliation visited upon America as foreign countries potentially impose new tariffs on the United States.

“We thus emphasize that these policies, if sustained, would likely push the US and global economy into recession this year,” the analysts said.