Aberdeen: Asia is the first to be affected by reciprocal tariffs, expecting a weakening of the U.S. economic growth outlook

Ray Sharma-Ong, Director of the Multi-Asset Investment Solutions at Aberdeen Southeast Asia, stated that Trump's tariff announcement exceeded most market expectations, with the new tariffs implemented on top of existing tariffs, bringing the average tariff rate to 20%. Asia is the first to be affected by these tariffs, while Latin America faces relatively lower tariffs. He also pointed out that the announcement indicates that short-term inflation rates will rise more than expected, and the negative impact on economic growth will also be greater than anticipated. Before the announcement, the U.S. GDP growth rate was expected to be between 1.2% and 1.5%. With the introduction of new tariffs, the economic growth outlook is expected to weaken, and unless the Federal Reserve takes rescue policy measures, the risk of economic recession will increase. Rising inflation data and significantly weakened activity data indicate that long-term Treasury yields may further decline in the short term. Ray Sharma-Ong anticipates that the market will react subconsciously, with the dollar weakening, the U.S. stock market reversing its gains, and risk appetite continuing to decrease. As investors shift to safe-haven assets such as U.S. Treasuries, yen, and gold, regions most severely affected by tariffs are expected to face further de-risking actions from investors