After the US close, a Kyodo report hit wires saying Trump will slap an additional 15% tariff on all imports from Japan. The yen dropped sharply on the news, with USD/JPY jumping above 147.50 before stabilising.
Japan had anticipated that items already facing tariffs under 15% would be raised to 15%, while those above—like beef—would remain unchanged. But the U.S. has confirmed the new 15% levy applies across the board, regardless of existing rates.
A few hours later, as markets grew more liquid, a similar report emerged from Japanese outlet Asahi. This second confirmation triggered another bout of yen selling, pushing USD/JPY to highs near 147.70. Its dipped back a bit as I post.
In further tariff news, Trump announced plans to impose “around” 100% tariffs on chips and semiconductors. However, firms building—or committing to build—manufacturing facilities in the U.S. will be exempt. As usual, details were vague. For example, Apple CEO Tim Cook was present at the announcement and promptly pledged $600 billion in U.S. investment over the next four years. For context, Apple’s total capex over the past four years was just $43 billion. Still, that was enough for Apple to secure an exemption, and AAPL shares jumped in after-hours trade.
Taiwan later confirmed it, too, has secured an exemption, with shares of TSMC rising. Samsung shares also gained on similar expectations, helping lift broader Asian equities.
There’s more: Trump floated the idea of applying China tariffs similar to the 25% duty recently imposed on India over its continued purchases of Russian oil. However, trade adviser Peter Navarro struck a more cautious tone, noting China is already facing 50% tariffs on many goods and warned against overreach:
- “We don’t want to get to a point where we actually hurt ourselves.”
- “Let’s wait and see,” he added—signalling no immediate move.
Data: Chinese July trade data showed another solid rise in exports. While direct shipments to the U.S. fell, untracked transshipments were not captured in the official numbers—by design, of course.
Fed watch: San Francisco Fed President Mary Daly largely reiterated her earlier comments, backing rate cuts in the near term. Her message aligns with a growing chorus of Fed officials signalling easing ahead.
FX: Major currency pairs traded in relatively narrow ranges—aside from the yen, which continued to chart its own, weaker path.
Asia-Pac
stocks:
- Australia
(S&P/ASX 200) -0.2%, letting the team down - Hong
Kong (Hang Seng) +0.3% - Japan
(Nikkei 225) +0.7% - Shanghai
Composite +0.1%