Asian currencies and shares that appeared falling on Monday after US President Donald Trump slapped import tariffs from the three largest trading partners in the country, triggering fears of trade war and their impact on the economy focused on exports in the region.
The gloomy market in Asia, with stocks depending on the most devastated exports, ranging from Japanese car makers to chip makers in Taiwan, South Korea, to Chinese e-commerce companies.
As Trump promised last month, the United States struck Canada and Mexico with a 25% task and China with a 10% levy, with a retaliation step immediately promised by Canada and Mexico, the two top US trading partners. China said it would challenge Trump’s levies in world trade organizations.
The reality of the trade war sent Mexico pesos to the lowest in almost three years, Canadian dollars to the lowest level of 22 years and off the coast of Yuan to the lowest record.
All currencies in Asia declined, with Baht Thailand and the Indonesian rupiah among the top losers.
“In the coming weeks, tariffs tend to represent overhang in the market and contribute to volatility, at least until investors get greater clarity on the path and objectives of the US trade policy,” UBS analyst said.
The market in Taipei TWSE: Taix dropped 3.5% while Seoul was 2.5% lower, burdened by exporters.
Exporters of Samsung Electronics and Taiwan Semiconductor Manufacturing Co (TSMC) chips fall 2.7% and 5.7%, respectively. TSMC was seen catching up with global sales in stocks related to made intelligence last week when Taiwan was closed for the Chinese New Year.
Bangkok shares traded around the lowest level over five years.
Stocks in Jakarta lost 2.2% in the weakest trading session in six months. Adaro mainstay heavy -class coal minerals and Adaro Minerals fell 4.5% and 8%, dragging local benchmark.
Indonesia, the largest economy in Southeast Asia, reported annual inflation under the range of the central bank’s target, a sign that the surprise policy loosened last month to increase expenditure and support the case for slaughtering other interest rates.
Rupiah traded 0.9% lower to greenback.
Indian rupees are increasingly weakening to new lowest, because investors bet on the decline in interest rates by the local central bank.
Peso Philippines and Ringgit Malaysia each fell 0.4% and 0.8%.
HIGHLIGHTS:
** INDONESIAN INFLATION IN JAN DI 0.76% Y/Y
** The Central Bank of Thailand said the economy slowed down in December
Source: Reuters
