The TACO trade is back! Many Asia-Pacific stock markets are rising today, despite Donald Trump\u2019s decision to ramp up his trade war by announcing new tariffs on 14 US trading partners.<\/p>\n
There\u2019s relief that Trump has announced a new pause before these new levies kick in \u2013 a new three-week reprieve kicks the can down the road to 1 August, rather than tomorrow.<\/p>\n
This delay will give countries to negotiate trade deals with the US.<\/p>\n
Asked if 1 August deadline was firm, Trump indicated it wasn\u2019t exactly concrete, saying last night<\/a>:<\/p>\n \u201cI would say firm, but not 100% firm. If they call up and they say we\u2019d like to do something a different way, we\u2019re going to be open to that.\u201d<\/p>\n<\/blockquote>\n That has encouraged traders to conclude that Trump Always Chickens Out (TACO).<\/p>\n So while there were losses on Wall Street last night after the first tariff letters were released, markets across Asia are taking the news in their stride.<\/p>\n In Tokyo, the Nikkei 2225<\/strong> has risen by 0.3%, up 118 points to 39,705 points, even though Japan has been threatened with a new 25% tariff from 1 August (slightly higher than the 24% rate announced back in April, before Trump\u2019s 90-day pause which expires tomorrow).<\/p>\n South Korea\u2019s KOSPI<\/strong> has gained nearly 2%, even though Seoul has also received a letter announcing a new 25% tariff.<\/p>\n China\u2019s CSI300<\/strong> index has climbed by 0.8%. European markets are expected to open flat.<\/p>\n More letters are expected to be sent later this week.<\/p>\n Stephen Innes, <\/strong>managing partner at SPI Asset Management, <\/strong>says traders are pricing in \u201cdelay, maybe even dysfunction\u201d, rather than a resolution of the trade war. But that\u2019s enough to keep them bidding.<\/p>\n Innes<\/strong> writes:<\/p>\n Markets didn\u2019t lurch because they\u2019ve seen this show before. Tariff hike, rhetoric spikes, and then\u2014like clockwork\u2014comes the sudden pivot: \u201cWe\u2019re still open to talks.\u201d This is policy by poker tell. And by now, investors are familiar enough with the bluff to call it and fade the fear.<\/p>\n<\/blockquote>\n However\u2026Ipek<\/strong> Ozkardeskaya<\/strong>, senior analyst at Swissquote<\/strong> Bank<\/strong>, fears there is too much \u201cunexplained optimism\u201d, adding:<\/p>\n The deadline extension is not good news, per se. It simply adds to the uncertainty. It\u2019s yet another sign that the deadline won\u2019t be a line in the sand, and that tariffs set in the coming days and weeks won\u2019t be carved in stone, either.<\/p>\n They will be constantly changed \u2014 raised, lowered \u2014 and used as a go-to threat in every situation.<\/p>\n<\/blockquote>\n The agenda<\/p>\n 9.30am BST: UK\u2019s Office for Budget Responsibility to release its latest Fiscal risks and sustainability report<\/p>\n<\/li>\n 10am BST: Marks & Spencer chair Archie Norman to face business and trade committee to discuss M&S\u2019s cyber attack<\/p>\n<\/li>\n 11am BST: Office for Budget Responsibility press conference<\/p>\n<\/li>\n 12pm BST: Post Office Horizon IT Inquiry to release Volume 1 of its Final Report<\/p>\n<\/li>\n<\/ul>\n Share<\/a><\/p>\n Updated at\u00a002.22 EDT<\/p>\n Key events<\/p>\n Show key events only<\/p>\n Please turn on JavaScript to use this feature<\/p>\n The markets are shrugging at Trump\u2019s latest tariff announcements, reports Bill<\/strong> Blain<\/strong>, market strategist at Wind Shift Capital<\/strong>.<\/p>\n Blain<\/strong> points out:<\/p>\n A year ago the idea a sovereign nation would blithely impose crippling global tariffs on its long-established friends, allies and competitors, and expect them to bend over and say; \u201cthank you sir, can I have some more\u2026\u201d would be dismissed as the mad haverings of a dystopian crackpot\u2026.<\/p>\n Today it\u2019s happening and no one bats an eyelid.<\/p>\n<\/blockquote>\n That\u2019s because markets have concluded that last night\u2019s tariffs are \u201cjust another TACO Trump ploy\u201d, he adds:<\/p>\n Deals will get done, and resumed its upwards trajectory. The bottom line is no one expects the global trading economy to disappear in a sudden puff of logic because Trump delights in throwing spanners in the works.<\/p>\n History shows global trade is resilient to both hot and cold conflict, and swiftly adapts.<\/p>\n<\/blockquote>\n Share<\/a><\/p>\n European stock markets have also opened higher, led by Germany.<\/strong><\/p>\n The German DAX index rose by 50 points, or 0.2%, to 24,125, in early trading, amid some relief that European negotiators have another three weeks to reach a trade deal with Washington.<\/a><\/p>\n France\u2019s CAC<\/strong> has inched up by 0.1%, with Spain\u2019s IBEX<\/strong> gaining 0.14%.<\/p>\n Jochen Stanzl, <\/strong>chief market analyst at CMC Markets<\/strong>, says:<\/p>\n Donald Trump has once again retreated from imposing tariffs, allowing the DAX to rise above the 24,000-point mark. It appears that investors are eager to test the previous week\u2019s highs once more, but the success of this endeavor will depend on the daily news regarding trade policy, which is expected to remain volatile. The trade issue continues to be a source of uncertainty for the stock market, and without a trade agreement with the U.S., a sustainable continuation of the rally could prove challenging.<\/p>\n This morning, the European Union faces both positive and negative news. On the positive side, the pause on tariffs has been extended until August. Trump seems to be sticking to his pattern of initially making threats before showing a willingness to negotiate. He likely understands that implementing reciprocal tariffs would be more harmful than beneficial to the ongoing discussions.<\/p>\n However, the negative aspect is that sector-specific tariffs on cars, auto parts, aluminum, and steel will remain in effect until August 1. This latest development is not cause for great celebration, as the EU has struggled to effectively counter the already high tariffs that are currently in place during the negotiations.\u201d<\/p>\n<\/blockquote>\n Share<\/a><\/p>\n The London stock market has opened slightly higher.<\/p>\n The FTSE<\/strong> 100<\/strong> share index has risen by 12 points, or 0.14%, to 8819 points, with mining companies among the risers.<\/p>\n Share<\/a><\/p>\n Malaysia\u2019s trade ministry has said it will press ahead with talks towards a \u201ccomprehensive\u201d trade agreement with the US, after receiving its letter from Donald Trump announcing a new 25% tariff.<\/strong><\/p>\n In a statement today, Malaysia\u2019s Ministry of Investment, Trade and Industry (MITI) said the country was committed to \u201ccontinued engagement with the US towards a balanced, mutually beneficial and comprehensive trade agreement\u201d, adding:<\/p>\n \u201cSpecifically, MITI will continue discussions with its US counterparts in good faith to address outstanding issues, clarify the scope and impact of the announced tariffs, and pursue avenues for the timely conclusion of our negotiations.\u201d<\/p>\n<\/blockquote>\n Share<\/a><\/p>\n Not every<\/strong> stock market is taking Trump\u2019s new tariffs in their stride.<\/p>\n Malaysia\u2019s major share index has dropped by 0.55% so far today, while Thailand\u2019s SET<\/strong> 50<\/strong> has lost 0.5%.<\/p>\n Malaysia is now facing a 25% tariff on US exports, while Thailand\u2019s new tariff rate was set at 36%.<\/p>\n Share<\/a>EU still hopes to conclude trade agreement in principle this week The EU still hopes to conclude an agreement in principle this week with Donald Trump over tariffs, after it was granted an extension of three weeks for talks.<\/strong><\/p>\n Ireland\u2019s deputy prime minister Simon<\/strong> Harris<\/strong> revealed the bloc had been given until 1 August to conclude talks or face tariffs on imports of up to 50%.<\/p>\n In exchange for accepting a 10% baseline tariff, the EU is looking for a series of concessions, my colleague Lisa O\u2019Carroll in Brussels reports.<\/p>\n This includes a reduced tariff quota for car imports and steel, currently attracting import duties of 27.5% and 50% respectively.<\/p>\n This addresses Germany\u2019s critical demand for concessions for its beleaguered car industry. The compromise would centre on manufacturers with plants in the US including major German brands Mercedes<\/strong> Benz<\/strong>, BMW<\/strong> and Volkswagen<\/strong>.<\/p>\n And the EU is looking for concessions on medical devices and wine and spirits, which currently attract a 10% tariff.<\/p>\n The EU also wants the tariff relief to kick in immediately an agreement is signed, and not have to wait weeks, as the UK did for formal text to be registered by the White House.<\/p>\n Uncertainty remains over Trump\u2019s threatened tariffs on pharma, Harris<\/strong> said, warning \u201cThis is obviously an area of significant concern to Ireland.\u201d<\/p>\n In a statement issued last night he added:<\/p>\n \u201cMy understanding is that we can now expect an extension of the current status quo until August 1 to give further time for the EU and the US to reach an agreement in principle on a mutually beneficial agreement that works for both sides.<\/p>\n \u201cHowever, it remains the position of the EU and the Irish government that we would like to conclude discussions on a trade agreement before August 1. I remain cautiously optimistic about reaching agreement in principle on a Framework Agreement.<\/p>\n \u201cI want to be clear that while it is likely there will be some form of tariffs going forward, their imposition even at a lower rate is bad for consumers, jobs, economic growth and investment.\u201d<\/p>\n<\/blockquote>\n Share<\/a>Bangladesh to hold further trade talks<\/p>\n Bangladesh will hold further negotiations with the United States to push for deeper tariff cuts, even as US President Donald Trump slapped a 35% levy on goods from the South Asian nation.<\/strong><\/p>\n Officials are scheduled to hold crucial trade negotiations with the Trump administration<\/a> from July 9-10 to seek a solution, Commerce Adviser to the interim government Sk. Bashir Uddin said in an interview from Washington.<\/p>\n \u201cWe will give and try our best to find mutually win-win proposition,\u201d he said, adding that the goal is to find a \u201ccommon ground,\u201d Bloomberg reports.<\/p>\n Bangladesh will hold further negotiations with the United States to push for deeper tariff cuts, even as Trump slapped a 35% levy on goods from the South Asian nation https:\/\/t.co\/Cg06ZRJebr<\/a><\/p>\n \u2014 Bloomberg (@business) July 8, 2025<\/a><\/p><\/blockquote>\n Share<\/a>German exports to US tumble as tariffs frontloading ends<\/p>\n German exports fell sharply in May, new data shows, as the surge in demand to beat Donald Trump\u2019s tariffs earlier this year faded.<\/strong><\/p>\n Exports to the US from Germany fell by 7.7% on monthly basis in May, statistics body Destatis<\/strong> reports. On an annual basis, German exports to the US were 13.8% lower than in May 2024.<\/p>\n Overall, German exports fell by 1.4% in May compared to the previous month, while imports dropped by 3.8%.<\/p>\n Exports to China fell by 2.9% month-on-month, but sales to the UK jumped by 15.1% compared with April.<\/p>\n Carsten Brzeski<\/strong>, global head of macro at ING, <\/strong>explains that the frontloading reversal continued in May, fully wiping out the surge seen in February and March, saying:<\/p>\n Today\u2019s data suggest that the boost to exports was almost exclusively driven by US frontloading. However, this effect has now dissipated.<\/p>\n Looking ahead, German exports are still facing rough headwinds. While the EU did not receive a new tariff letter from the White House yesterday, the risk of (more) tariffs hangs like a sword of Damocles over German and European exporters. And there is more: the strengthening of the euro, not only vis-\u00e0-vis the US dollar but also in nominal effective terms, is adding to exporters\u2019 concerns.<\/p>\n<\/blockquote>\n Share<\/a>China warns Trump on tariffs, and threatens retaliation on supply chain deals<\/p>\n China has fired a warning shot at the US over the Trump trade wars.<\/strong><\/p>\n An editorial in the People\u2019s Daily newspaper warned Washington not to reignite trade tension by restoring tariffs on its goods next month (when the deadline for a US-China trade deal expires)<\/p>\n It declared:<\/p>\n \u201cOne conclusion is abundantly clear: dialogue and cooperation are the only correct path.\u201d<\/p>\n<\/blockquote>\n Reiterating Beijing\u2019s view that Trump\u2019s tariffs amount to \u201cbullying\u201d, the paper added:<\/p>\n \u201cPractice has proven that only by firmly upholding principled positions can one truly safeguard one\u2019s legitimate rights and interests.\u201d<\/p>\n<\/blockquote>\n The article was signed \u201cZhong Sheng\u201d, or \u201cVoice of China\u201d, a term the paper uses to express views on foreign policy.<\/p>\n It also threatened retaliation against nations that strike deals with the United States to cut China out of supply chains.<\/p>\n Share<\/a>Japan and South Korea to continue trade talks with the US<\/p>\n Japan and South Korea have both said they will continue talks with the US to agree trade deals.<\/strong><\/p>\n Japan\u2019s<\/strong> Prime Minister Shigeru<\/strong> Ishiba<\/strong> said today that Japan would continue negotiations with the United States to seek a bilateral trade deal that benefits both countries.<\/p>\n Japan has received a proposal from the United States to continue trade discussions until the newly set August 1 deadline, Ishiba<\/strong> said in a meeting with cabinet ministers to discuss Japan\u2019s strategy in dealing with U.S. tariffs.<\/p>\n South<\/strong> Korea<\/strong> said it planned to intensify trade talks with the United States and considered U.S. President Donald Trump\u2019s plan for a 25% tariff from August 1 as effectively extending a grace period on implementing the levies.<\/p>\n President Lee<\/strong> Jae<\/strong> Myung\u2019s<\/strong> office said U.S. Secretary of State Marco Rubio had indicated the new deadline, which extends a previous July 9 date, meant there was still time to reach an agreement. Reuters reports.<\/p>\n South<\/strong> Korea\u2019s<\/strong> Industry Ministry said Seoul would \u201cstep up negotiations during the remaining period to reach a mutually beneficial result,\u201d adding”:<\/p>\n \u201cWe also plan to use it as an opportunity to improve domestic systems and regulations to resolve the trade deficit that is a major interest of the United States.\u201d<\/p>\n<\/blockquote>\n Share<\/a>Donald Trump’s new tariff rates<\/p>\n If you missed it last night, here are the new tariffs which Donald Trump announced in a flurry of letters to world leaders:<\/p>\n Reminder: These rates will be charged on imports into the US from these countries, and paid by the importer.<\/strong><\/p>\n Michael Brown, <\/strong>senior research strategist at bokerage Pepperstone<\/strong>, says \u201cPresident Trump got his random number generator out again yesterday\u201d, adding:<\/p>\n I won\u2019t even waste time in trying to find the logic behind those levels because, frankly, I\u2019m not sure there is any. Some sit higher than the 2nd April original levy, and some are marginally lower.<\/p>\n What\u2019s most important is that none of them come into effect for another three-and-a-half weeks, giving the Trump Administration plenty of wriggle room to set this all up as another \u2018escalate to de-escalate\u2019 manoeuvre. Or, as we more commonly know it in these parts \u2013 TACO!!<\/p>\n<\/blockquote>\n Share<\/a><\/p>\n Updated at\u00a003.13 EDT<\/p>\n Introduction: Asia-Pacific markets shrug off new Trump tariff threats<\/p>\n Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.<\/strong><\/p>\n The TACO trade is back! Many Asia-Pacific stock markets are rising today, despite Donald Trump\u2019s decision to ramp up his trade war by announcing new tariffs on 14 US trading partners.<\/p>\n There\u2019s relief that Trump has announced a new pause before these new levies kick in \u2013 a new three-week reprieve kicks the can down the road to 1 August, rather than tomorrow.<\/p>\n This delay will give countries to negotiate trade deals with the US.<\/p>\n\n
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![\"Lisa](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2025\/07\/1751960470_331_Lisa-OCarroll-byline-004.jpg\")
Lisa O’Carroll<\/p>\n\n
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