Dollar strengthens as Trump proposes larger tariffs, pressuring global markets

The US dollar strengthened after President Donald Trump called for “much bigger” universal tariffs, surpassing the 2.5% proposed by Treasury Secretary Scott Bessent. Trump hinted at imposing levies on foreign-made semiconductors, pharmaceuticals, and metals to boost domestic production.

Asian markets fell, with the MSCI Asia Pacific Index dropping 0.6%, led by losses in Japanese tech stocks like Advantest Corp. (-11%) and SoftBank Group (-6%). This followed a US market selloff sparked by concerns over high valuations in the AI sector, triggered by Chinese startup DeepSeek’s AI model.

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The Bloomberg Dollar Spot Index rose 0.4%, while the Australian and New Zealand dollars slid 0.5% or more. Treasuries saw yields inch up, with the 10-year climbing to 4.55%.

Copper prices dipped amid Trump’s tariff threats on metals, while Hong Kong stocks saw mixed results. Shares of China Vanke rose 2.1% after government support despite reporting a record loss.

Global traders are now watching Big Tech earnings from Microsoft and Apple, with the group’s profit growth expected to slow to its weakest in two years.