Trump’s New Asian Tariffs Might Not Pack the Punch You’d Expect

Trade wars just got a crypto-style volatility twist.

Trump’s latest tariff play against Asian partners looks more like a slow bleed than a knockout blow—classic political theater with questionable economic impact. Markets yawned, analysts shrugged, and the usual suspects started hedging with Bitcoin.

Because nothing says ‘stable monetary policy’ like swapping fiat fireworks for decentralized exit strategies.

Tariff increases could cut profits by 1% for every 5 points

The administration has warned over 20 countries that new tariffs on their exports will kick in on August 1 unless they secure new deals.

They cautioned that the burden of these tariffs WOULD vary significantly across both geography and sector. In particular, markets in Taiwan, South Korea, and Japan face the greatest share of US-linked revenues.

Conversely, economies in Southeast Asia and sectors focused on domestic demand, such as utilities, banking, telecommunications, and property, are comparatively less affected.

“The impact of tariffs will therefore not be evenly distributed,” they said.

Nevertheless, potential downsides persist. Goldman Sachs estimates that each 5-point tariff hike could trim corporate profits by about 1%.

“Earnings forecasts for a given market could be impacted through the direct exposure of revenues to the US, the tariff pass-through rate, and the sensitivity of listed companies to the domestic growth backdrop.”

If US rates fall and the dollar weakens, investors may FLOW into Asian assets, and firms will find dollar loans cheaper, helping to soften the impact.

After the administration’s inaugural tariff declaration on “Liberation Day,” Asian equity benchmarks initially dipped but later rebounded. The Nikkei 225 has gained approximately 1% year-to-date, while the Hang Seng Index is up NEAR 25%, buoyed by strong performance in Chinese AI equities.

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