US president also said he would announce reciprocal tariffs – raising US tariff rates to match those of trading partners – this week

In our business blog today, my colleague Graeme Wearden reports that Donald Trump’s tariff interventions are leading some to describe the markets experiencing a “febrile February” with volatility high on the agenda.

He quotes Richard Hunter, head of markets at interactive investor, who said “Tariffs remain central to the uncertainty, with President Trump’s latest announcement on Sunday likely to keep investors on edge this week. He has threatened reciprocal tariffs across the board to equal the rates being charged to the US, quite apart from a 25% levy on the import of steel and aluminium.”

While the US is not the manufacturing-focused economy it once was, it still consumes tens of millions of tons of steel and aluminum a year, feeding industries such as automaking, aerospace, oil production, construction and infrastructure, such as roads and bridges. Tariffs would increase the cost of production in those industries both because of the increased cost of the imported steel, and because domestic steel and aluminum makers could raise the price of their products due to the reduced competition from low-priced imports. Canada and Mexico are the largest and third largest exporters of steel to the US, respectively.