UK steelmakers have warned that the imposition of latest US tariffs could be “a devastating blow” to the trade, after Donald Trump mentioned he would announce 25% tariffs on metal and aluminium imports into the US.
Gold reached a report excessive and aluminium costs rose as monetary markets had been rattled by the US president’s feedback, which precipitated concern within the UK and the EU.
Gareth Stace, the director common of the commerce physique UK Metal, mentioned: “The US is our second-largest export market after the EU. At a time of shrinking demand and excessive prices, rising protectionism globally, significantly within the US, will stifle our exports and injury over £400m price of the metal sector’s contribution to the UK’s stability of commerce.”
Stace mentioned it might be “deeply disappointing” if Trump determined to focus on UK metal, given its “comparatively small manufacturing volumes in comparison with main metal nations”.
He added that there was a hazard that different international locations might determine to dump metal on the UK market to keep away from US tariffs. “The introduction of additional US tariffs will inevitably divert world commerce flows, with extra metal doubtlessly redirected to the UK market,” he mentioned.
UK Metal’s members embody Tata, the proprietor of the huge Port Talbot steelworks, and troubled British Metal, owned by China’s Jingye.
Trump is anticipated to formally announce new tariffs this week. Neighborhood, the union for the UK metal trade, mentioned the prospect of contemporary duties was extraordinarily regarding and will threaten jobs.
Alasdair McDiarmid, the Neighborhood assistant common secretary, mentioned: “For the US it might even be self-defeating because the UK is a number one provider of specialist metal merchandise required by their defence and aerospace sectors.”
The European Fee mentioned: “The EU sees no justification for the imposition of tariffs on its exports. We are going to react to guard the pursuits of European companies, employees and customers from unjustified measures.”
As buyers rushed for a haven for his or her cash, the spot worth of gold elevated by 1.6% to $2,910 an oz, above the report excessive set on Friday. Gold has been rising in current weeks amid considerations over the affect of Trump’s insurance policies. It has gained greater than 10% because the begin of the yr, after ending 2024 at $2,623 an oz.
Aluminium costs additionally rose, as buyers anxious that the tariffs might result in provide issues and hit financial development, which would scale back demand for the metallic. The three-month aluminium contract on the London Metallic Change has gained by 0.3% to $2,635 (£2,122) a tonne.
In London, the FTSE 100 hit a report excessive because the greenback strengthened towards the pound – reaching 8,770.08 factors, three factors above the earlier intraday excessive set final week. Most firms on the index are massive multinationals that earn their revenues in {dollars} and report earnings in sterling.
On Wall Avenue, the Dow Jones industrial common and the S&P 500 jumped greater than 0.5% on the open, with the Dow up 246 at 44,550 factors.
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Shares in US steelmakers rose on hopes the tariffs would hit rivals or permit them to lift costs. Cleveland-Cliffs, North America’s largest flat-rolled metal producer, shot up by 16% and Nucor Company, the Charlotte, North Carolina-based steelmaker, gained 6%.
Chatting with reporters onboard Air Power One, the US president mentioned he would announce reciprocal tariffs on Tuesday or Wednesday, to take impact virtually instantly, matching the tariff charges levied by different international locations. “Very merely, it’s ‘in the event that they cost us, we cost them’,” Trump mentioned.
Canada, Brazil, Mexico, South Korea and Vietnam are the most important sellers of metal into the US, in accordance with authorities and American Iron and Metal Institute information, whereas Canada is the principle provider of imported aluminium.
Trump mentioned on Sunday that his administration was analyzing US treasury debt funds for attainable fraud, suggesting that the nation might have much less debt than thought. In keeping with the US treasury, the US has $36tn of public debt, equal to greater than 120% of GDP.
Trump mentioned administration officers who had been combing via fee data to determine any wasteful spending had turned their consideration to debt funds.
“We’re even taking a look at treasuries,” Trump mentioned. “There could possibly be an issue – you’ve been studying about that – with treasuries, and that could possibly be an attention-grabbing drawback.”
It was not clear whether or not Trump was referring to debt service or different authorities funds made by the treasury division.
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