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Emerging assets weighed down by Trump’s blanket tariff threat

  • Developing-world currencies, including the South African rand and Mexican peso, edged lower amid Trump's tariff threat.
  • The Bloomberg Asia Dollar Index is down 0.4% this week, heading for its largest weekly loss in six weeks, while an index for EM equities also weakened.
  • Despite the tariff threat, some investors remain optimistic about the longer-term trends supporting developing economies.
  • Markets are volatile over the uncertainty caused by tariff announcements, with investors closely monitoring US inflation data and the Federal Reserve's policy trajectory.

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