BY WAYNE COLE
SYDNEY- Asian shares dithered and the dollar edged higher on Monday after US President Donald Trump warned more tariffs were imminent including on steel and aluminum, an inflationary move that could limit the scope for rate cuts.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 0.3 percent, while Japan’s Nikkei inched up 0.1 percent. South Korea’s main index fell 0.1 percent, led by losses in steel makers.
Chinese blue chips were little changed, with worries about deflation soothed by data showing consumer inflation accelerated to its fastest in five months in January.
EUROSTOXX 50 futures added 0.2 percent, as did FTSE futures while DAX futures rose 0.1 percent.
Wall Street futures started lower but soon rallied as investors looked ahead to another busy week of earnings. S&P 500 futures firmed 0.3 percent, while Nasdaq futures added 0.5 percent.
Speaking to reporters on Air Force One, Trump said he would announce on Monday 25 percent tariffs on all steel and aluminum imports into the US and reveal other reciprocal tariffs on Tuesday or Wednesday.
The comments came just after German Chancellor Olaf Scholz said the European Union was ready to respond “within an hour” if the US levied tariffs on European goods, highlighting the risks of an escalating trade war.
China’s retaliatory tariffs on some US exports are due to take effect on Monday, with no sign as yet of progress between Beijing and Washington.
“These could be a strategic negotiating tool for President Trump or the beginning of a prolonged trade war,” said Stephen Dover, head of the Franklin Templeton Institute. – Reuters
