Simply forward of the 1 Aug deadline, US President Donald Trump signed an government order on Thursday (31 Jul) that changed ‘reciprocal’ tariffs on plenty of international locations/areas, with up to date levies starting from 10% to 41%. The tariff charges are slated to take impact from 7 August. The unique “reciprocal” tariff charges had been introduced on 2 April ‘Liberation Day’, which shocked world markets with its unexpectedly excessive charges. The US subsequently paused the implementation for 90 days and as a substitute carried out a common 10% baseline charge for many exporters, and set a brand new deadline of 1 August, UOB Group’s FX analyst Suan Teck Kin experiences.
Tariff reset forward of 1 August deadline
“US President Trump signed an government order adjusting ‘reciprocal’ tariffs on 69 international locations, efficient 7 Aug, with charges starting from 10% to 41%. Key impacts embody lowered tariff charges for ASEAN international locations and 10% baseline for Singapore. Funding pledges from the EU and Japan to spend money on the US had been additionally introduced.”
“Transshipment of products will face a 40% tariff, however particulars stay unclear and topic to bilateral negotiations. Sector-specific tariffs add to uncertainty, with pending investigations into semiconductors and prescription drugs. Singapore could also be uncovered, as prescription drugs made up 35% of its US export worth in 2024, up from 24% in 2023.
“Whereas tariff readability has improved, uncertainties round transshipment and sector-specific tariffs persist. The US shift in direction of bilateral offers has upset the globalization efforts, elevate inflation dangers and world commerce tensions. De-dollarization considerations are rising, although the US greenback will stay dominant for a while. Asia’s export outlook could soften in 2H25 and into 2026, whereas regionalization accelerates, with ASEAN poised to profit from initiatives just like the Johor-Singapore SEZ and FDI inflows on this unsure setting.”
