Trump tariffs live: FTSE hits lowest level in months amid global market meltdown

“Donald Trump is Liz Truss,” the financier and Rest is Politics US podcast host Anthony Scaramucci has said, in a reference likening the US president’s tariffs policy to the former prime minister’s disastrous mini-Budget, which led to her resigning after just 49 days in office.

Mr Scaramucci, who also spent just 10 days as Barack Obama’s White House communications chief, said: “The sudden imposition of the highest import tariffs for a century will make the US economy less competitive and so likely to grow more slowly.

“It also signals that the US has become a less welcoming place for foreign capital. As Louis likes to put it, the US is now less a destination for capital and more a source of capital.”

The Independent’s political editor David Maddox writes:

Within minutes of Donald Trump’s announcement on so-called “reciprocal tariffs” around the world, Brexiteers were claiming victory because the UK escaped with half the rate imposed on the EU.

But if the UK’s 10 per cent import tariffs to the American market compared to the EU’s 20 per cent, is the best economic justification for Brexit that can be made, then supporters of leaving the EU are clutching at straws.

The first and most obvious point is that Brexit has not spared the UK from having tariffs imposed on it by the one world leader who was the biggest cheerleader outside Britain for the UK leaving the EU.

Britain is yet to benefit from the “Brexit dividend” – the economic gain that was promised when it left the EU. And far from the trade deal that Brexiteers promised would follow with the US, there is still none in place nine years after the referendum. Even if Keir Starmer lands one, it is likely to be highly focussed on specific areas and may not avoid tariffs altogether.

Even with half the rate of tariffs compared with those imposed on the EU, the difference barely goes anywhere near undoing the economic harm that Brexit has done to the UK economy.

The question over whether the UK should accept chlorinated chicken from the United States is “almost entirely a proxy battle for whether UK trade policy should favour the US or EU more”, a trade expert has said.

David Henig, UK director of think-tank Ecipe, said on social media: “Though this doesn’t have to be the case (NB Swiss exception) if the UK signs up to US food standards, bye bye deep EU trade relationship. That was why the Brexiters wanted a US trade deal, and hoped wrongly CPTPP would achieve the same.

“And right now even the possible prospect of a UK-US trade deal is casting doubt in Brussels about the reset, which may be manageable but with the sort of care and skill that goes far beyond ‘bridge’ talk and hasn’t previously been shown by the UK.

“Behind all the bluster the trade policy view is pretty simple. 50 per cent of UK trade is with Europe, less than 20 per cent with the US. That seems pretty stable, therefore even folk in the US understand the likely implications, possibly better than the UK government.”

Taiwan’s government has announced at least T$288 bn (£6.74bn) in financial help for companies and industries to deal with the impact of US tariffs, including export credits.

Donald Trump has imposed a whopping 32 per cent tariff on goods – excluding semiconductors – imported from Taiwan, just two months after the US became Taiwan’s top export destination. The US accounted for 28.5 per cent of the country’s total outbound sales in February, overtaking China and Hong Kong’s 28.4 per cent for the first time in 24 years, Taiwan’s Central News Agency reported, citing official data.

Speaking at a news conference in Taipei, premier Cho Jung-tai reiterated that the government regarded the tariffs as unreasonable, saying it would provide T$88bn to help companies affected. Finance minister Chuang Tsui-yun said the government would also provide T$200bn in trade financing for exporters.

The announcements were made before financial markets re-open in Taiwan on Monday, having been closed on Thursday and Friday for a holiday.

Donald Trump’s global tariffs will stymie economic growth and cause rising inflation, forcing the US Federal Reserve to start lowering interest rates from the end of this year – while the European Central Bank could cut rates as soon as this month, analysts have forecast.

The tariffs are “worse than feared”, said Japanese investment bank Nomura, lowering its US growth estimate to 0.6 per cent from 1.5 per cent, on a quarterly basis, and hiking its core year-end inflation forecast to 4.7 per cent – up from 3.5.

As a result, the brokerage expects the Fed to lower rates in December, taking the policy rate to 4.125 per cent, followed by two more 25 bps cuts in the first quarter of 2026. It had previously expected the central bank to hold at 4.25-4.5 per cent until the second quarter of 2026.

“Increased downside risks to growth and a more front-loaded inflation shock should allow cuts to resume sooner than we had expected”, Nomura economists said in a note on Thursday.

And the ECB will be forced to act even quicker than the Fed, said Nomura, which now expects the central bank to cut rates in April as well as June, resulting in a terminal rate of 2 per cent, from 2.25 per cent predicted previously.

Sir Tony Blair has urged Sir Keir Starmer not to retaliate against Donald Trump’s tariffs, saying such a move wouldn’t be in the UK’s “best interests”.

It comes as officials scramble to respond to the news that British exports to the US would face a blanket 10 per cent levy, sending global markets tumbling and sparking fears the chancellor’s fiscal headroom could be wiped out.

In a rare intervention, the former prime minister told students at King’s College London that he supported Sir Keir’s “cool heads” approach to Trump’s “Liberation Day”, and he didn’t really understand the intellectual argument behind the tariff policy.

“I don’t think it is in the UK’s best interest to retaliate,” he said, but admitted he did not know where developments over the tariffs would end.

Jane Dalton and Millie Cooke have more details in this exclusive report:

The Independent’s chief political commentator, John Rentoul, will be answering your questions in a live Q&A today at 1pm.

With Donald Trump’s new tariffs affecting UK exports, Keir Starmer’s government faces critical decisions.

What does this mean for Britain’s economy and post-Brexit trade? How will it impact UK-US and UK-EU relations?

Join the discussion and ask your questions here:

France’s finance minister Eric Lombard has opened the door to letting the French government’s deficit reduction target slip this year – ruling out extra spending cuts and tax increases to offset a potential shortfall in growth.

Speaking to BFM TV, Mr Lombard said things were uncertain and it was necessary to wait to see in the coming weeks how negotiations with the United States would go over recently announced tariffs to have a better idea of their impact on the French economy.

If tariffs on the European Union – amounting to 20 per cent on EU imports, with higher levels on certain French territories – were maintained, Mr Lombard said, “revenue would decrease, the GDP would decrease, which would – without getting too technical – degrade the level of the deficit, and I think in that case, to protect the French people, I think we must accept that.”

France has been aiming to trim its deficit to 5.4 per cent of economic output this year from 5.8 per cent last year as a step toward bringing its shortfall in line with a European Union ceiling of 3 per cent by 2029.

But Paris still has one of the biggest fiscal gaps in the EU and, unlike other big European countries, it will not be able to bring its debt burden to pre-pandemic levels by the end of the decade.

Banking stocks are among the heavier fallers on the FTSE 100 this morning as the UK index slumped to its lowest level since 15 January, with Asia-focused firm Standard Chartered dropping by around 4 per cent.

Mining and commodity stocks were also among the fallers, after specific tariffs on metal production, such as aluminium.

It came after further declines in the Asian markets, after heavy losses across global stock markets on Thursday.

The Hang Seng Index in Hong Kong was down 1.5 per cent and Japan’s Nikkei dropped 2.4 per cent, adding to losses in the previous session, as traders continued to digest the impact of Donald Trump’s tariff plans.

In the US on Thursday, the Dow Jones and S&P indexes both suffered their worst days since 2020.

The FTSE is now down 1.16 per cent in early morning trading, with Germany’s DAX index also tumbling 1.12 per cent and the Euronext 100 down 1.49 per cent this morning.

The below graph, from the London Stock Exchange, shows the FTSE’s downwards trajectory in recent days: