KUALA LUMPUR, Jan 23 (Bernama) -- Bursa Malaysia’s benchmark index recouped earlier losses to settle higher, maintaining a more than six-year high, buoyed by continued buying interest in technology stocks, while the strengthening of the ringgit against the US dollar further lifted investor sentiment. At 2.27 pm today, the local currency strengthened to 3.9992 versus the greenback, its strongest level in more than seven years. It was last seen at this level on June 18, 2018, at 3.9960/9990. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 2.85 points or 0.17 per cent to 1,719.99 from yesterday’s close of 1,717.14. The index surpassed its previous peak of 1,719.00 recorded on Feb 26, 2019. The barometer index opened 1.30 points lower at 1,715.84 and moved between an intraday low of 1,711.89 in early trade and a high of 1,723.41 in late afternoon before slipping slightly toward the close. However, market breadth was negative with decl...
The Trump administration is once again raising the stakes on global trade, with President Donald Trump threatening to impose 25% tariffs on any country that continues doing business with Iran. The move is aimed at tightening economic pressure on Tehran amid escalating unrest and renewed concerns over Iran’s nuclear programme.
Key Developments
- 25% tariff threat on Iran trading partnersTrump said countries trading with Iran could face blanket 25% tariffs, a move that would likely affect major economies such as China and India, both key buyers of Iranian oil.
- Tariffs may not be finalAccording to policy analysts, the proposed tariffs could stack on top of existing duties, but exemptions or reversals are possible within 48 hours, especially given Washington’s recent efforts to maintain stability with China and manage cost-of-living pressures.
- Geopolitical backdrop intensifiesTrump warned Iran was nearing U.S. “red lines” following reports of civilian deaths during a two-week uprising. At the same time, he indicated that talks with Tehran may be forthcoming on its long-running nuclear dispute.
Strategic Signals Behind the Move
- Economic leverage before tougher optionsAnalysts see the tariff threat as a way to apply economic pressure ahead of more aggressive actions, which could include expanded sanctions, cyber operations, or limited military strikes.
- China factor looms largeChina is among Iran’s largest trading partners. If tariffs are enforced, retaliation from Beijing is possible, though experts expect quiet diplomatic engagement in the near term to prevent escalation.
- Not a full-scale military pivotDespite tougher rhetoric, observers believe Trump is unlikely to pursue a broad military campaign. Instead, the focus remains on targeted, transactional measures that can deliver quick political wins.
Market and Policy Implications
- Higher trade uncertaintyThe tariff threat adds another layer of uncertainty to global trade flows, particularly in energy markets.
- Negotiation tool, not endgameHistory suggests Trump’s tariff announcements often serve as opening leverage, with room for negotiation, carve-outs, or delays.
Bottom Line
Trump’s latest tariff warning underscores his willingness to use trade policy as a geopolitical weapon. While the threat of 25% tariffs on Iran’s trading partners is significant, markets and governments alike are likely to view this as a pressure tactic rather than a settled policy, at least for now.
Comments
Post a Comment