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Malaysias Ministry of Trade: Not considering retaliatory tariffs.Vishnu Varathan, head of macro research for Asia (excluding Japan) at Mizuho Securities, said on April 3 that U.S. reciprocal tariffs may continue to be a source of economic headwinds. These tariffs may also "inadvertently intensify and increase vulnerability to adverse demand shocks." Varathan said: "Asia has been particularly hard hit, especially in Cambodia, Vietnam, Thailand and Indonesia." In addition, South Korea, Japan, India and the European Union have not been spared, while the United Kingdom, Australia and Singapore have been the least affected. Varathan added that, therefore, the pressure on Asian currencies, except for Japan, may continue.On April 3, the Wall Street Journal reported that German automaker Volkswagen will impose an "import fee" on cars affected by US President Trumps 25% tariff. The report cited a memo sent to retailers saying that Volkswagen has temporarily stopped rail transportation from Mexico and will temporarily keep cars arriving by ship from Europe at the port. According to the agencys analysis of tariff codes contained in the Federal Register, Trumps 25% auto tariff will cover more than $460 billion worth of auto and auto parts imports each year. According to the report, Volkswagen told its dealers that it will provide more details on the pricing strategy for cars affected by tariffs by mid-April and plans to start distributing the cars to stores by the end of the month.European Commission President Ursula von der Leyen: The global economy is expected to suffer significant losses. Uncertainty will rise sharply and trigger new protectionism.European Commission President Ursula von der Leyen: Europe will stand on the side of those countries directly affected.

Copper price falls below $3.40 as recession fears intensify

Alina Haynes

Oct 25, 2022 15:28

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Copper prices fall below Monday's lows as fears of a US economic recession intensify. The base metal has broken to the downside from the consolidation formed in a narrow band of $3.41 to $3.44 and is aiming for further depreciation as rising interest rates challenge growth rate forecasts.

 

A Reuters poll predicts that the Federal Reserve (Fed) will raise interest rates by 75 basis points (bps) in the first week of November. Notably, the Federal Reserve is acting particularly actively to reduce the inflation rate. Consequently, policy-tightening measures have been consistently popular.

 

This has increased the likelihood of a future recession, as the growth rate has been significantly lowered and unemployment levels are anticipated to rise. Fears of a recession have bolstered US Treasury Chief Janet Yellen's statement that one "cannot rule out the likelihood" of a recession, as reported by MSNBC.

 

China's copper imports have increased by 25.6% during the past year. Amid the announcements of stimulus measures by the Chinese government to avoid the implications of the zero-tolerance Covid strategy and a real estate crash, infrastructure spending has increased. After the monsoon season in Asia, construction and real estate firms are known to recover throughout the winter months.

 

According to a report by ANZ Research, copper imports increased significantly as the forecast for demand in the power industry improved.

 

After the third continuation of XI Jinping's leadership in China, his policy pronouncements will continue to be crucial moving forward.

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