Asia's Super-Rich Rapidly Scale Back US Exposure on Trade War
Some of Asia's richest families are cutting exposure to US assets, saying President Donald Trump's tariffs have made the world's largest economy much less predictable.
One family office managing assets for Chinese billionaires exited its US holdings entirely and will shift the proceeds to Asia. A senior executive at one of Europe's largest private banks said the scale of the recent selloff from rich clients and institutions around the world is unprecedented over the past three decades and could be the beginning of a more persistent shift. A top bank executive in Asia got rid of 60% of US assets from his own portfolio, saying it's safer to hold cash and gold.
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NEW YORK (AP) — U.S. President Donald Trump has promised to hike nearly all of his tariffs on foreign steel and aluminum to a punishing 50% on Wednesday, a move that would hammer businesses from automakers to home builders, and likely push up prices for consumers. Foreign-made steel and aluminum is used in household products like soup cans and paper clips as well as big-ticket items like a stainless-steel refrigerators and cars. Economists warn that the latest tariffs will significantly squeeze the wallets of both companies and shoppers alike. Here's what we know. What's the tariff rate on imported steel and aluminum now? Steel and aluminum imports are currently taxed at 25% — a rate that both metals have faced across the board since March 12 when Trump's order to remove steel exemptions and raise aluminum's levy from his previously-imposed 2018 import taxes went into effect. That's about to double. In a proclamation issued Tuesday, Trump confirmed that the U.S. will begin taxing nearly all steel and aluminum imports at 50% after the clock strikes midnight Wednesday. Steel and aluminum from the U.K., meanwhile, will continue to be levied at 25% due to a recent trade deal. Why is Trump raising these tariffs? Trump says it's all about protecting U.S. industries. He reiterated that argument on Friday, when he first announced the 50% tariff during a visit with steelworkers in Pennsylvania, where he also discussed a 'planned partnership' between U.S. Steel and Japan's Nippon Steel. In his speech at U.S. Steel's Mon Valley Works–Irvin Plant in suburban Pittsburgh, Trump said that the tariff hike would 'further secure the steel industry in the U.S.' Shortly after, he took the same tone when sharing plans to also raise tariffs on imported aluminum. In Tuesday's proclamation, Trump also said that the higher tariffs would ensure that imported steel and aluminum would 'not threaten to impair the national security.' 'In my judgment, the increased tariffs will more effectively counter foreign countries that continue to offload low-priced, excess steel and aluminum in the United States,' he said in the proclamation. How is the industry responding? While some analysts have credited the tariffs Trump imposed during his first term with strengthening domestic production of steel and aluminum, many others have warned that stark new levies can make it difficult for the industry to adjust. Some organizations representing metal workers also note that tariffs aren't the only solution needed to boost U.S. manufacturing. 'While tariffs, used strategically, serve as a valuable tool in balancing the scales, it's essential that we also pursue wider reforms of our global trading system,' David McCall, international president of the United Steelworkers union said in a statement, noting that work must be done 'in collaboration with trusted allies' like Canada — the top exporter of steel and aluminum to the U.S. — to help 'contain the bad actors.' Matt Meenan, vice president of external affairs at the Aluminum Association, added that the trade group 'appreciates President Trump's continued focus on strengthening the U.S. aluminum industry,' but that 'tariffs alone will not increase U.S. primary aluminum production.' 'We also need consistent, predictable trade and tariff policy to plan for current and future investment,' Meenan said. What kinds of products could be impacted by heightened steel and aluminum tariffs? A range of businesses that rely on foreign-made steel and aluminum have already begun feeling the impacts of Trump's previously-imposed levies. But the latest anticipated hikes could drive up costs even more. Steel and aluminum are used in a range of products like washing machines, consumer electronics and cars. Much of the auto industry relies on a global supply chain. And even if you aren't in the market to buy a new vehicle, repairs could involve parts that use imports of either metal, driving up overall maintenance and ownership costs. In the grocery aisle, steel and aluminum are ubiquitous in the packaging for many foods, including canned tuna, soup and nuts. Experts warn that hiking import taxes on these materials could led to higher grocery prices overall, further straining consumers wallets. The aluminum and metal tariffs also carry wider implications for construction and transportation as a whole, as many key building parts and materials are made with these metals. Economists further warn of spillover impacts. Even if a product isn't directly packaged in steel or aluminum, there could be higher costs to build the shelf it's sold on, for example, or truck used to transport it to the store. And all of that could trickle down to the consumer down the road. If foreign competition becomes 'priced out' due to these new tariffs, U.S. steel and aluminum producers may also find room to raise their own prices. As a result, even companies that don't buy these foreign metals could end up paying more. Steel prices have already climbed 16% since Trump became president in mid-January, according to the government's Producer Price Index. And as of March 2025, steel cost $984 a metric ton in the U.S., significantly higher than than in Europe ($690) or China ($392), per the U.S. Commerce Department. Will there be any exceptions? The new 50% tariff rate will apply to nearly all steel and aluminum coming into the U.S. from other countries. But the U.K., which recently reached a sweeping trade agreement with the U.S., will see an exception. As part of trade deal reached between the two nations on May 8, the U.K. said that the U.S. had agreed to eliminate its current 25% duties on British steel and aluminum down to zero. That exemption had yet to go into effect in the weeks following — but in his proclamation issued Tuesday, Trump acknowledged that it was 'necessary and appropriate' to implement the deal, and would 'accordingly provide different treatment' for these metals coming from the U.K. Per Trump's proclamation, the duty on British steel and aluminum will now stay 25%. But that rates could be adjusted starting on July 9 if the U.S. government determines that Britain has not complied with the framework. Trump's planned hikes for steel and aluminum tariffs for the rest of the world could spark retaliation from other trading partners. In response to levies imposed on these metals earlier in the year, for example, the European Union previously outlined countermeasures. The 27-nation bloc later delayed those actions until July 14 in efforts to ease negotiations, but said on Monday that was preparing a list of measures to enact if a trade deal with the U.S. crumbles. _______ AP Writers Jill Lawless in London, Josh Boak and Michelle Price in Washington, D.C., contributed to this report.
