Markets still guessing as tariff risks escalate, warns Deutsche Bank

Deutsche Bank has cautioned that markets remain in the dark when it comes to assessing the true impact of potential U.S. tariffs. While investors are broadly pricing in 50% tariffs on Chinese goods and just under 10% on imports from other countries, the bank argues that the real consequences will hinge on what happens next.

• market impact won’t just depend on the size of the tariffs
• will be shaped by how countries respond—through retaliation, fiscal measures, tax changes or even currency moves like a yuan devaluation

That warning looks increasingly timely. Just yesterday, news broke that China, Japan and South Korea are reportedly preparing a coordinated response to any future U.S. tariff actions. A joint retaliation effort by Asia’s three largest economies would mark a significant escalation in global trade tensions, potentially fuelling market volatility and complicating central bank policy paths.

This article was written by Eamonn Sheridan at www.forexlive.com.