Trump’s High Tariffs Shake World Markets, May Push Global Economy Toward Recession – Reuters
The world’s stock markets took a hard hit after U.S. President Donald Trump announced steep tariffs on goods coming into the U.S., saying foreign countries must “pay a lot of money” if they want the tariffs lifted. According to Reuters, Trump described the tariffs as “medicine” needed to fix trade problems—even if it causes short-term pain.
What Are Tariffs and Why Are They a Big Deal?
Tariffs are extra taxes added to products imported from other countries. When these taxes go up, it can lead to higher prices for goods, less business activity, and even fewer jobs. This is why many investors and world leaders are worried.
According to Reuters, stock markets in Asia crashed, European shares fell to their lowest level in over a year, and oil prices dropped quickly. Experts fear this could lead to a global recession—a time when economies around the world slow down or shrink.
Banks and Investors Sound the Alarm
Big financial companies like Goldman Sachs and JPMorgan have cut their expectations for U.S. economic growth. Goldman Sachs, as reported by Reuters, now thinks there’s a 45% chance of a recession in the next 12 months.
One investment expert, Robert Pavlik, told Reuters that people are scared this could lead not just to a recession, but even a depression—which is a much more serious and longer economic downturn.
Trump Stands Firm, Even as Markets Fall
Even though trillions of dollars have been lost in stock markets, Trump isn’t backing down. Speaking to Reuters and other reporters while on Air Force One, Trump said he doesn’t like seeing markets go down, but believes it’s necessary to take tough steps now to fix trade issues.
He also criticized China for hitting back with its own tariffs and asked the Federal Reserve to lower interest rates to help the economy. Still, Fed chief Jerome Powell doesn’t seem ready to act immediately.
Europe and Asia React
Governments in Europe and Asia are trying to figure out how to respond. Reuters reports that EU leaders are meeting to form a united plan. But they’re divided. Some fear that pushing back too hard could hurt their own companies.
Germany’s incoming leader Friedrich Merz told Reuters that this situation shows how much Europe needs to become more competitive—with lower taxes and cheaper energy.
Meanwhile, Volkswagen’s Audi brand is holding back cars that landed in the U.S. because of a new 25% auto tariff.
Will This All Lead to a Deal?
Some countries want to avoid a trade war. Reuters says Taiwan’s President has offered to discuss zero tariffs, and India and Vietnam are also ready to talk rather than fight. In Europe, Dutch Trade Minister Reinette Klever told Reuters that it’s time to sit down with the U.S. and negotiate.
At the same time, well-known business leaders like Jamie Dimon (CEO of JPMorgan) and Bill Ackman are warning that these tariffs could cause serious, long-term problems. Ackman even said it could lead to an “economic nuclear winter.“
Even Elon Musk, who normally supports Trump, said he’d prefer zero tariffs between the U.S. and Europe. On Monday, he posted a video of famous economist Milton Friedman supporting free trade.
Unique Perspective for Our Readers:
What’s happening now shows how deeply connected the world economy is. One decision by a leader like President Trump, as explained by Reuters, can affect millions of jobs, the prices we all pay for goods, and the future of countries around the world. While Trump says this is just “medicine,” many people and businesses are hoping it doesn’t end up being a bitter pill that causes more harm than good.
Source: This report is based on news originally published by Reuters. For regular updates, follow us and stay informed on global trade, economics, and politics.
https://www.reuters.com/world/trumps-tariff-medicine-injects-turmoil-into-global-markets-2025-04-07