IMF warns of ‘significant risk’ to global economy from Trump tariffs as markets slide

 

IMF warns of ‘significant risk’ to global economy from Trump tariffs as markets slide

 

Fund boss Kristalina Georgieva says it is important that US and trading partners avoid escalating trade war

 

Mark Sweney

Fri 4 Apr 2025 08.51 BST

https://www.theguardian.com/business/2025/apr/04/imf-warns-of-significant-risk-to-global-economy-from-trump-tariffs-as-markets-slide

 

The International Monetary Fund has warned that Donald Trump’s implementation of swingeing tariffs poses a “significant risk” to the global economy, as stock markets continue to be hit by a brutal sell-off by investors.

 

Kristalina Georgieva, the managing director of the IMF, said it is important that the US and its trading partners avoid further escalating the global trade war, while markets in Asia and Australia suffered further declines on Friday.

 

“We are still assessing the macroeconomic implications of the announced tariff measures, but they clearly represent a significant risk to the global outlook at a time of sluggish growth,” Georgieva said. “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.”

 

Japan’s Nikkei index fell almost 3% on Friday, ending the week down 9%, while Tokyo’s Topix was down 4.5%. South Korea’s Kospi closed down 1.3%. In London, the FTSE 100 fell 41 points at the open on Friday morning.

 

Australia’s S&P/ASX 200 index fell 2.2% amid fears of a global recession after Trump’s announcement of the steepest trade barriers in more than 100 years.

 

Brent crude has fallen another 1.1% today to $69.40 a barrel, its lowest level in more than three weeks, after heavy losses on Thursday, amid fears of a slowdown in demand.

 

Shares in Indian pharmaceutical companies also slumped after Trump said that US tariffs on drugmakers were still under consideration.

 

The NSE Nifty Pharma Index fell more than 6% on Friday and is on track for its biggest decline since the onset of the Covid pandemic in March 2020.

 

Pharmaceutical companies had experienced a boost on Thursday as the sector was believed to have been exempted from the US import duties.

 

Europe and the US account for 55% of India’s pharmaceutical exports.

 

The US president’s “liberation day” tariff policies, which has resulted in sweeping border taxes of between 10% and 50% imposed on almost every nation, has wiped more than $2.5tn (£1.9tn) off Wall Street stocks and share prices in other financial centres across the globe.