Financial markets were hit hard by another wave of selling at the start of trading in Asia on Monday, with investors and economists grappling with rising odds of a severe economic downturn caused by President Trump’s significant new tariffs on imports.
Trading was extremely volatile. Stocks in Japan plunged over 8 percent, while South Korea tumbled about 5 percent. In Australia, stocks fell more than 6 percent.
Over the weekend, analysts circulated notes warning that Asia could be particularly vulnerable to a tit-for-tat exchange of retaliatory tariffs between China and the United States. Many countries in the region, including Japan and South Korea, count both nations as their top trading partners.
President Trump doubled down on Sunday evening, saying that he would not ease his tariffs on other countries “unless they pay us a lot of money.” He also dismissed concerns that his steep new taxes on imports will lead to higher prices. “I don’t think inflation is going to be a big deal,” he told reporters on Air Force One.
On Friday, China struck back at the United States with a 34 percent tariff on a number of American exports, matching a 34 percent tariff that Mr. Trump imposed on China last week.
