KUALA LUMPUR, April 25 (Bernama) -- Bursa Malaysia extended its uptrend for a third consecutive day on Friday, closing higher on renewed buying interest amid positive regional market performance due to potential de-escalating US-China trade tensions. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 2.68 points, or 0.18 per cent, to 1,509.20 from Thursday’s close of 1,506.52. The benchmark index opened 5.12 points better at 1,511.64, and moved between 1,505.68 and 1,512.29 throughout the day. Market breadth was positive, with advancers beating decliners 651 to 325, while 434 counters were unchanged, 1,047 untraded, and 39 suspended. Turnover improved to 3.10 billion units valued at RM1.95 billion against Thursday’s 3.08 billion units valued at RM2.14 billion.
1. Consumer Costs in the U.S.
Everyday goods—clothing, tools, appliances, electronics—heavily sourced from China, will become significantly more expensive.
Retailers like Costco, Walmart, and Home Depot are expected to pass these cost increases on to consumers, hitting American wallets hard.
2. Production & Employment in China
U.S. consumers buying less due to higher prices → decrease in demand for Chinese exports.
This could lead to factory slowdowns and job losses in China.
3. China’s Retaliation
Tariffs on U.S. exports like soybeans, airplanes, medical equipment will make American goods less competitive.
Alternative suppliers (Brazil for soybeans, Airbus for aircraft) may benefit instead.
Beijing’s Response
China labeled the tariffs "blackmail" and vowed to "fight to the end."
Beijing, led by President Xi, is unlikely to appear as capitulating—especially to a strategy it sees as extortionist.
Risk of Escalation
The tariffs don’t just hit China—they include close U.S. allies, like Canada, Australia, and the EU.
This could drive traditional allies closer to China economically, even if begrudgingly.
💱 Non-Tariff Retaliation Tools
China may retaliate by:
Manipulating currency (as seen with yuan depreciation)
Restricting access for U.S. companies operating in China
Banning exports of rare earth minerals, vital for U.S. tech and defense industries
Tightening customs rules or regulations to make U.S. business in China harder
On Tariff Evasion
Re-routing through Vietnam or other countries to avoid tariffs is a known issue.
If goods are simply repackaged, the U.S. may impose penalties.
But if manufacturing genuinely shifts to other countries, that’s seen as legitimate supply chain diversification.
Will China Call Trump?
It’s uncertain. China may prefer third-party mediation or wait for U.S. concessions.
Trump’s framing of the situation as a "waiting for a call" narrative may not match Beijing’s diplomatic style.
Overall Economic Impact
Tariffs act as a tax on trade, raising prices and reducing competitiveness.
Consumers and businesses on both sides suffer.
The risk is not just economic—it’s geopolitical, potentially redefining alliances and trade blocs.
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