Trump's Tariff Offensive: A New Chapter in Trade History

Donald Trump continues his controversial tariff policy and announced on the Truth Social platform that new tariffs will come into effect on October 1st. Specifically, the former president plans to introduce 100% levies on imported branded and patented pharmaceuticals, 25% tariffs on heavy commercial vehicles, and new levies on household goods, including kitchen furniture and upholstered furniture. Trump emphasizes that these measures are necessary in response to the uncontrolled influx of these products into the USA by foreign manufacturers. This not only endangers national security but also the American manufacturing industry. However, the tariffs on pharmaceuticals will only apply to companies that do not establish manufacturing facilities in the USA. A newly built facility would exempt them from the levy. It remains unclear whether the new tariffs will be implemented through emergency measures or based on completed investigations under Section 232. Nevertheless, Trump appears unfazed by the rising inflation in August and ongoing lawsuits against existing tariffs. Data from the Bureau of Labor Statistics shows the largest monthly price increase in food since August 2022. The consumer price index, excluding food and energy, rose by 3.1% in the same month. This announcement caused unrest in financial markets, especially among Asian pharmaceutical stocks, which suffered losses on the trading day. The Japanese Topix Pharma Index fell by 1.4%, with significant losses at Sumitomo Pharma, Daiichi Sankyo, and Chugai Pharmaceuticals. Prices also plummeted in South Korea and Hong Kong, as well as in India, where the Nifty Pharma Index dropped by up to 2.7%.