Washington (TDI): President Donald Trump said on Sunday the sweeping tariffs that he has imposed on Mexico, Canada and China may cause “short term” pain for Americans as international markets reflected concerns the levies could undermine growth and reignite inflation.
Trump stated that he would speak with the leaders of Canada and Mexico on Monday but downplayed hoped could change his mind, despite their announced retaliatory tariffs.
“I don’t expect anything dramatic,” Trump said while returning to Washington from his Mar-a-Lago estate in Florida.
“They owe us a lot of money, and I am sure they are going to pay.”
He also said tariffs would “definitely happen” with the European Union (EU), but did not say when.
Critics say the Trump’s plan to impose 25 percent tariffs on Canada and Mexico and 10 percent tariffs on China will slow global growth and drive prices higher for Americans.
Also Read: Trump impose tariffs on China, Mexico, and Canada
The Republican president says they are required to curb immigration and narcotics trafficking and spur domestic industries.
“We may have short term some little pain, and people understand that. But in the long run, the US has been exploited by nearly every country in the world.”
Stocks Stumble, Oil Prices Surge
Financial market reaction was not positive. U.S. stock futures dropped in early Asian trading, with Nasdaq futures NQc1, opens new tab down 2.35 percent, S&P 500 futures EScv1, opens new tab 1.8 percent lower. U.S. oil prices jumped more than $2, while gasoline futures jumped more than 3 percent.
North American firms braced for new duties which could upend industries from autos to consumer goods to energy.
Also Read: Canada, Mexico, China Can’t Halt Tariffs: Trump
Trump’s tariffs will cover nearly half of all U.S. imports and would need the US to more than double its own manufacturing output to cover the gap – an unfeasible task in the near term, according to ING analysts.
“Economically speaking, escalating trade tensions are a lose-lose situation for all nations involved,” the analysts wrote in a note on Sunday.
Other analysts said the tariffs could throw Canada and Mexico into recession and cause “stagflation” – high inflation, stagnant economic growth and elevated unemployment – at home.
