Canada says response to 25% aluminium and steel tariff will be ‘clear and calibrated’; Hong Kong to file complaint with World Trade Organization over tariffs imposed on city

• Trump announces 25% tariffs on foreign steel and aluminium

Asia-Pacific stock markets are mixed as traders digest Trump’s tariffs announcement.

China’s CSI 300 index has dipped by 0.5%, while South Korea’s KOSPI is up 0.6%.

Trump said on Monday that tariffs on metals could go higher, and other tariffs could be announced later this week. At this stage, traders have little clarity about how far Trump’s tariff policies will go, whether they are mostly a negotiating tactic or if they will have a more long-lasting economic impact. It is also unclear if it will spark a wave of protectionism.

The Vix volatility index fell to 15.81 on Monday, which is below the 12-month average of 15.92. This is a clear sign that investors have some ‘tariff fatigue’ and it may take another driver, such as inflation concerns, to move the dial for equity markets. While volatility remains low, this could help stocks to grind higher.

The US dollar extended gains and gold hit a fresh ATH fuelled by fresh tariff threats from Donald Trump. In addition, China now allows insurers to buy gold and hold 1% of their holdings in the precious metal as other investment options are not ideal at the moment.