Yesterday Donald Trump announced sweeping tariffs of 25% on imports of steel and 10% on imports of aluminium. Though this may help some American workers, the overall effect could be disastrous. If trade partners retaliate, as many say they will, a ruinous trade war could ensue. Protecting the steel industry is an old idea. But the lack of process and the threat to rules-based global trade are new.

Stocks tumble around the globe in the wake of President Trump‘s planned tariffs on steel and aluminum – 25% and 10%, respectively – which are raising fears of a potential trade war. Japan’s stock market was Asia’s worst performer in today’s trade, with the Nikkei tumbling 2.5% and just three of the index’s 225 stocks ending with gains; Honda (NYSE:HMC) and Toyota (NYSE:TM) fell by a respective 3.8% and 2.3%. All other Asian markets also fell, with declines of more than 1% in South Korea, where steelmaker Posco (NYSE:PKX) fell 3.6%, and in Hong Kong. Stocks in Europe are trading at two-week lows, as the European Commission said it could take the U.S. decision to the World Trade Organization.

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