Key events
Tokyo’s Nikkei 225 has now lost 3.5%, while the broader Topix index has fallen 4.45%. It’s just after 1pm in Japan.
Kate Lyons
Trade tariffs imposed on tiny Australian territories that are either uninhabited or claim to have no trading relationship with the US appear to have been calculated based on erroneous trade data.
The data relates, at least in part, to shipments mislabelled as coming from remote Norfolk Island, or Heard Island and McDonald Islands, instead of their correct countries of origin, the Guardian can reveal.
Among the erroneously-labelled shipments over the past five years from the island territories are shipments of aquarium systems, Timberland boots, wine and parts for a recycling plant.
According to an analysis of US import data and shipping records, multiple shipments of goods were classified as having originated from Norfolk Island or Heard and McDonald islands when neither the company address, nor the port of departure for the shipment, nor the destination port were located in those territories.
In some cases involving Norfolk Island, which is 1,600km north-east of Sydney and has a population of 2,188, the confusion appears to have resulted from the fact that the company’s address or port of departure is Norfolk, UK, or the destination is Norfolk, Virginia in the US, or a company’s registered address in New Hampshire (NH) has been listed instead as Norfolk Island (NI).
Norfolk Island was this week hit with a 29% tariff on its goods – 19 percentage points higher than the rest of Australia – despite having no export relationship with the US.
Donald Trump’s cumulative tariff hikes amount to about 22%, which would be equivalent to the biggest US tax increase since 1968, according to a note from JPMorgan.
Reuters reports that the bank has raised its risk of global recession to 60%, up from 40% previously, and said the tariff impact could be “magnified by retaliation, supply chain disruptions, and a sentiment shock.”
The note cautions that “sustained restrictive trade policies and reduced immigration flows may impose lasting supply costs that will lower U.S. growth over the long run.”
JPMorgan added that these policy actions could evolve in the coming weeks, that “the US and global expansions stand on solid ground and should be able to withstand a modest-sized shock”.
Tariffs imposed by US a ‘national crisis’, Japanese PM says
Tariffs imposed on Japanese goods by US President Donald Trump are a “national crisis,” prime minister Shigeru Ishiba has said.
The levies of 24% on Japanese imports “can be called a national crisis and the government is doing its best with all parties,” Ishiba said in parliament.
His comments came as Japanese stock markets dived; as we reported earlier the Nikkei lost 1.8% after opening on Friday, adding to a drop of 2.77% a day earlier.
On Thursday, Japan’s trade minister, Yoji Muto, said the tariffs on Japanese exports were “extremely regrettable” while chief cabinet secretary Yoshimasa Hayashi told reporters the tariffs may contravene World Trade Organization rules and the pair’s trade treaty.
New Civil Liberties Alliance, a conservative legal group, has filed what it says is the first lawsuit seeking to block Donald Trump’s tariffs on Chinese imports, saying the US president overstepped his authority. Reuters reports:
The lawsuit, filed in federal court in Florida, alleges that Trump lacked the legal authority to impose the sweeping tariffs unveiled on Wednesday as well as duties authorized on February 1 under the International Emergency Economic Powers Act.
“By invoking emergency power to impose an across-the-board tariff on imports from China that the statute does not authorize, President Trump has misused that power, usurped Congress’s right to control tariffs, and upset the Constitution’s separation of powers,” NCLA senior litigation counsel Andrew Morris said in a statement.
White House representatives did not immediately respond to an email seeking comment.
NCLA filed the lawsuit on behalf of Simplified, a Florida-based retailer of home management products.
Trump on Wednesday announced that China would be hit with a 34% tariff, on top of the 20% he imposed earlier this year, bringing the total new levies to 54%.
The lawsuit asks a judge to block implementation and enforcement of the tariffs and undo Trump’s changes to the US tariff schedule.
The lawsuit says presidents can only impose tariffs with Congress’ permission and under complex trade statutes spelling out how and when they can be authorized.
The French president, Emmanuel Macron, called the tariffs introduced by the US president, Donald Trump, “brutal and unfounded”.
Trump unveiled a 10% minimum tariff on most goods imported to the US, with a higher 20% rate for the EU. Macron said European countries must suspend planned investment in the US after the announcement:
Virginia Harrison
In the Pacific, Fiji is the hardest hit by Trump’s tariffs. It has been levied with a 32% tariff, Vanuatu at 22% and Nauru at 30%.
Fiji prime minister Sitiveni Rabuka said the move was akin to a “trade blockade” that his country could not win.
“We cannot fight a war, a trade war particularly. We don’t have anything to counter with. So we will have to weather the storm and roll [with] the punches,” he said, as reported by FBC.
The US is Fiji’s biggest goods export market, dominated by the country’s eponymous branded water, according to AAP. Roughly $253m worth of the bottled spring water headed across the Pacific in 2023.
“I’d be surprised if it means the end of Fiji Water exports, they’ve built a market and a brand that’s more resilient than that,” Westpac analyst Justin Smirk told AAP.
Other Pacific nations, including Papua New Guinea, Samoa, Tonga, Solomon Islands, Cook Islands, Kiribati and the Federated States of Micronesia, have been given a 10% tariff.
The kind of drops experienced by US stock markets on Thursday are “entirely without precedent”, Lawrence Summers, an economist and treasury secretary under Bill Clinton, has said. In a post on X, he wrote:
Today was the worst stock market experience in five years. Usually when you have a terrible stock market experience, it’s because a bank fails, a pandemic, a hurricane or because some other country does something.
We don’t have these kinds of stock market responses in response to policies that the President of the United States is proud of. That is something that is entirely without precedent. It is extremely dangerous.
In an earlier post he wrote:
If any administration of which I was a part had launched an economic policy so totally ungrounded in serious analysis or so dangerous and damaging, I would have resigned in protest.
Lauren Gambino
Senior senators introduced new bipartisan legislation on Thursday seeking to claw back some of Congress’s power over tariffs after Donald Trump unveiled sweeping new import taxes and rattled the global economy with sweeping new import taxes.
The Trade Review Act of 2025, co-sponsored by Senator Chuck Grassley, a top Republican lawmaker from Iowa, a state heavily reliant on farm exports, and Senator Maria Cantwell, a Democrat from Washington, whose state shares a border with Canada, would require the president to notify Congress of new tariffs, and provide a justification for the action and an analysis on the potential impact on US businesses and consumers.
For the tariff to remain in effect, Congress would need to approve a joint resolution within 60 days. If Congress failed to give its consent within that timeframe, all new tariffs on imports would expire. The legislation would also allow Congress to terminate tariffs at any time through a resolution of disapproval.
Robert Tait
The first signs of an internal US political backlash against Donald Trump’s declaration of a global trade war were starting to emerge on Thursday amid tanking stock markets worldwide and widespread international criticism of the move.
Hours after Trump unveiled a sweeping panoply of tariffs in an event he dubbed “liberation day”, four Republican senators openly defied him by voting for a Senate resolution from Democrats demanding that the 25% tariffs on Canadian products be reversed.
The resolution lacks the force of law but its support from Mitch McConnell and Rand Paul, both of Kentucky, Susan Collins of Maine, and Lisa Murkowski of Alaska, immediately signaled the deep misgivings among some Republicans over Trump’s tariff gambit, which has triggered a global sell-off.
Lauren Aratani
Zooming in on US stock markets – all three major US funds closed down in their worst day since June 2020, during the Covid pandemic.
Here’s our latest full report from the US:
US stock markets tumbled on Thursday as investors parsed the sweeping change in global trading following Donald Trump’s announcement of a barrage of tariffs on the country’s trading partners.
All three major US stock markets closed down in their worst day since June 2020, during the Covid pandemic. The tech-heavy Nasdaq fell 6%, while the S&P 500 and the Dow dropped 4.8% and 3.9%, respectively. Apple and Nvidia, two of the US’s largest companies by market value, had lost a combined $470bn in value by midday.
Patrick Commins
The managing director of the International Monetary Fund, Kristolina Georgieva, has warned that Trump’s sweeping new tariffs “clearly represent a significant risk to the global outlook at a time of sluggish growth”.
In a brief statement issued this morning, Georgieva cautioned against retaliation to American trade aggression, even as the European Union and China threatened to respond in kind.
“It is important to avoid steps that could further harm the world economy. We appeal to the United States and its trading partners to work constructively to resolve trade tensions and reduce uncertainty,” she said.
Trump has said he is ready to negotiate and willing to dial back import taxes if countries can offer him something “phenomenal”.
Asia markets plunge further after US stocks mark worst day in five years
Asian markets have posted further losses after opening on Friday, hours after US markets closed the day with some of their worst losses in five years, with tech stocks particularly hard hit.
Tokyo’s Nikkei index was down 1.8% at 34,108.23, adding to a drop of 2.77% on Thursday. The broader Topix index was off 2.3%, having lost 3.08% the previous day.
Chip-related shares were some of the worst performers on Friday, with Advantest and Tokyo Electron down 7% and 4%, respectively.
Australia’s S&P/ASX 200 index fell as much as 2% on Friday, to an eight-month low.
On Thursday, Wall Street’s tech-heavy Nasdaq Composite plunged 6%, while the retreat in the S&P 500 was its biggest in a day since 2020.
In Europe, both the Paris and Frankfurt stock exchanges finished the day with losses of more than 3%.
Oil prices plummeted more than 6% on concerns an economic downturn sparked by Trump’s trade policies would hit demand. The price of gold hit another new record.
The dollar slumped by as much as 2.6 percent versus the euro, its biggest intraday plunge in a decade, and suffered sharp losses also against the yen and British pound.
On Friday, the US currency fetched 146.33 yen in early Asian trade, rebounding slightly from 145.99 yen in New York.
Opening summary
Global financial markets have been plunged into turmoil as Donald Trump’s escalating trade war knocked trillions of dollars off the value of the world’s biggest companies and heightened fears of a US recession.
Asian markets plunged further on Friday morning, with the Nikkei in Tokyo dropping 1.8% and Australia’s S&P/ASX 200 index falling as much as 2%, to an eight-month low.
About $2.5tn (£1.9tn) was wiped off Wall Street and share prices in other financial centres across the globe by day’s end on Thursday.
IMF chief Kristolina Georgieva warned that the tariffs represented a “significant risk” to the global economy and warned against retaliation, while world leaders from Brussels to Beijing rounded on Trump. China condemned “unilateral bullying” practices and the EU said it was drawing up countermeasures.
Trump himself insisted market turmoil was no issue – telling reporters “markets will boom”.
On Friday, economists will be anxiously awaiting the latest US jobs figures – due out at 8.30am eastern time. It may take months for the impacts of Trump’s tariff decision to work their way into the jobs figures. But outside of the government’s official figures there are already signs that the resilience of the US jobs market is being tested.
Here’s a round-up of the key moments so far:
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The New York stock exchange had its worst day of trading since June 2020 – during the early months of the Covid-19 pandemic. The main indices saw their worst one-day falls in five years as Donald Trump claimed that “the markets are going to boom” in response to his sweeping tariffs.
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The heaviest falls in share prices on Thursday were reserved for US companies with complex international supply chains stretching into the countries that Trump is targeting with billions of dollars in fresh border taxes. Apple, which makes most of its iPhones, tablets and other devices for the US market in China, was down 9.5% at close of trading, and there were steep declines for other large multinationals including Microsoft, Nvidia, Dell and HP.
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Canada will retaliate against “unjustified, unwarranted” tariffs imposed by the United States with a 25% taxes on US vehicles, Mark Carney announced on Thursday. The US has placed 25% taxes on Canadian steel, aluminum and vehicles.
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The UK business secretary, Jonathan Reynolds, told MPs that ministers were still pursuing an economic deal with the US as the priority but “we do reserve the right to take any action we deem necessary if a deal is not secured”.
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The French president, Emmanuel Macron, said Trump’s decision to impose tariffs of 20% on EU goods was “brutal and unfounded”, while Germany’s outgoing chancellor, Olaf Scholz, called it “fundamentally wrong”. Spain’s prime minister, Pedro Sánchez, said the “protectionist” tariffs ran “contrary to the interests of millions of citizens on this side of the Atlantic and in the US”.
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Mitch McConnell, the Kentucky Republican senator and former Senate majority leader, has criticized Donald Trump’s latest tariffs, saying that they are “bad policy and trade wars with our partners hurt working people most”. Trump told reporters aboard Air Force One that tariffs on imported semiconductor chips and pharmaceuticals will be coming “soon”.
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The US dollar hit a six-month low, falling 2.2% on Thursday morning, amid a growing loss of confidence in a currency previously considered the safest in the world for most of the past century.
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Tariffs will fall heavily on some of the world’s poorest countries, with nations in south-east Asia, including Myanmar, among the most affected. Cambodia, where about one in five of the population live below the poverty line, was the worst-hit country in the region with a tariff rate of 49%. Vietnam faces 46% tariffs and Myanmar, reeling from a devastating earthquake and years of civil war after a 2021 military coup, was hit with 44%.
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The EU is thought to be preparing retaliatory tariffs on US consumer and industrial goods – likely to include emblematic products such as orange juice, blue jeans and Harley-Davidson motorbikes – to be announced in mid-April, in response to steel and aluminium tariffs previously announced by Trump.
