KUALA LUMPUR, March 17 (Bernama) -- Bursa Malaysia extended gains to a third consecutive session today, driven by broad-based buying across various sectors following the recent strong sell-off, in line with the performance of regional markets, an analyst said. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 15.66 points, or 1.04 per cent, to 1,527.81 from Friday’s close of 1,512.15. The benchmark index opened 5.43 points firmer at 1,517.58 -- its intraday low -- and peaked at 1,531.63 during the mid-morning session and maintained its momentum throughout the afternoon session. On the broader market, gainers thumped decliners 708 to 297, while 425 counters were unchanged, 994 untraded, and seven suspended. Turnover improved to 3.28 billion units worth RM2.40 billion from 3.24 billion units worth RM2.5 billion on Friday.
The impact of U.S. tariffs on goods like steel and aluminum continues to affect both the U.S. economy and consumers. Experts are debating whether the effects of these tariffs will bring higher prices and slow economic growth, especially with inflation already at relatively high levels.
Tariffs and Their Economic Impact:
Tariff Increases: Tariffs on aluminum and steel are going higher than before, but the economic argument behind these increases is unclear. Aluminum production in the U.S. isn't very elastic, meaning it won’t increase much despite higher prices. This could mean continued high prices for aluminum products without the expected boost in local production.
Previous Impact: In 2018, a 25% tariff on steel reduced U.S. steel consumption by 7 million tons. Businesses such as automakers and homebuilders started using less steel to reduce costs, leading to products being made with slightly thinner parts.
Job Impact:
Manufacturing Jobs: While the tariffs might create a small number of jobs in industries like steel production, many more jobs could be lost in other sectors such as automotive and home construction. Estimates suggest that 75,000 manufacturing jobs could be lost, which are typically higher-paying than jobs in steel production.
Foreign Companies’ Role: Jobs created in the U.S. may not all be from American companies. Many foreign companies, like Alcoa, which operates in Canada, could bring jobs back, but these could benefit foreign firms instead of American workers.
Passing Costs to Consumers:
Price Increases: Companies facing higher material costs are faced with a choice: absorb the costs or pass them on to consumers. The last round of tariffs showed that many companies fully passed the costs on to consumers, but with current economic challenges, this time the pass-through could be less.
Consumer Sensitivity: With inflation already high, consumers are more likely to feel the impact of price hikes. Small increases in everyday items, like a washing machine, could lead to more price sensitivity. People are already seeing higher prices in stores, and their expectations for inflation are rising, potentially making them more cautious with their purchases.
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