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US stocks have plummeted as Wall Street doubled its predictions of a recession in America in the wake of Donald Trump’s trade war.
Moody’s, the credit ratings agency, has raised the odds of a recession in the world’s largest economy to 40pc, up from 15pc at the start of the year. Meanwhile, Goldman Sachs, the investment bank, said the probability of a recession had hit 35pc, up from 20pc.
Both blamed the new ratings on weaker consumer confidence and a likely acceleration of inflation.
The S&P 500 and the Nasdaq hit more than six-month lows on Monday. Investors sent the S&P 500 down by as much as 1.7pc.
The Nasdaq fell by up to 2.5pc and the Dow Jones lost up to 1.1pc.
In London, the FTSE 100 closed down 0.9pc, hitting a one-month low, while the FTSE 250 lost 2pc.
Daniela Hathorn, an analyst at Capital.com, said: “Quite a lot of negativity has been priced in, but markets are bracing for the worst to come.”
Moody’s chief economist Mark Zandi warned that mounting tariffs and cuts by Elon Musk’s Department of Government Efficiency (Doge) were raising the risk of a downturn.
He said: “The intensifying trade war and Doge cuts are behind all this and with last week’s announcement of big tariff increases on vehicle imports and the coming reciprocal tariffs, things are sure to get worse.”
Goldman Sachs said it now expected reciprocal tariffs to be “more aggressive”, averaging 15pc across US trading partners.
Read the latest updates below.
07:00 PM BST
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06:53 PM BST
Trump hails inward investment as economists warn of tariff war
Donald Trump has taken to his Truth Social platform in a series of posts to hail success in attracting inward investment to the US.
It comes two days before his expected hikes to global tariffs which economists and Wall Street analysis have warned increase the risks of a US recession.
06:38 PM BST
White House says tariffs will bit any country treating US ‘unfairly’
Any nation that treats the United States unfairly should expect to be targeted by tariffs, the White House has said.
Karoline Leavitt, the White House spokesman, said: “Any country that has treated the American people unfairly should expect to receive a tariff in return on Wednesday ... It’s time for reciprocity, and it’s time for a president to take historic change to do what’s right for the American people.”
Yesterday, in a conversation with reporters on Air Force One, US president Donald Trump said tariffs would essentially cover all countries.
06:14 PM BST
Uncertainty won’t disappear this week, UBS warns
Uncertainty about Donald Trump’s trade war will not disappear after Donald Trump’s tariff announcement on Wednesday, a major bank has said.
Jason Draho, of UBS Global Wealth Management, said: “As much as investors might hope for it, this is unlikely to put an end to tariff uncertainty.
“Uncertainty and market volatility are likely to stay high in the near term as investors recalibrate their outlooks after these events.”
Mr Trump is expected to announce details of his reciprocal tariffs on US trading partners on April 2.
05:56 PM BST
Retaliation against Trump tariffs would be ‘stupid’, says economist
Hiking tariffs against the US would damage the British economy, an economist has warned.
Julian Jessop, an economics fellow at the Institute of Economic Affairs, said: “A depressingly large number of people believe that the best response to someone else doing something stupid – imposing tariffs that raise costs for their own businesses and households – is to do the same thing yourself.
“The OBR has estimated that UK GDP will be as much as 0.6pc lower than otherwise next year if the US imposes additional global tariffs of 20pc. But this hit increases to 1.0pc if other countries, including the UK, are daft enough to impose reciprocal tariffs on the US.
He added that UK consumers could receive “small gains” as a result of other countries repelling imports. He said: “Consumers might benefit from lower prices for some goods, such as cars, if producers in the EU and Asia redirect stock to the UK market which they can no longer sell into the US.
05:48 PM BST
Tariff war hits travel industry
Holiday companies are losing out as fears of a trade war cause people to cut back on discretionary spending.
Danni Hewson, of AJ Bell, said that worries about tariffs causing a recession seem to be hurting the travel sector.
She said: “Fears over the potential impact on consumer confidence came into focus with news from Virgin Atlantic that it had seen a slowdown in demand over the past few weeks despite a solid start to 2025 – a sentiment already shared by US giant Delta.
“Travel stocks were just one sector under pressure today. Delta, United Airlines, Airbnb, Expedia and Royal Caribbean Cruises were all amongst the losers stateside and British Airways owner IAG and EasyJet also saw their shares in the red.
“All those nice-to-haves are back in focus. If people are worried about their personal finances or concerned about losing their jobs, they’re not going to be splashing out on a fancy new pair of trainers or placing big bets on their favourite sports team.
“People’s savings cushions have been eaten into by rising prices and whilst many households could cope when costs started to mount a few years ago, things are very different in 2025.”
05:42 PM BST
UK recession ‘could very well materialise’ from trade war, says economist
The could find itself in recession as a result of problems on the Continent, an economist has warned.
George Lagarias, chief economist at Forvis Mazars, said: “For a country like Britain, already grappling with low growth and persistent services inflation, the direct and indirect consequences of a trade war can be substantial.
“Even if somehow the UK is spared from direct tariffs, Mr Trump’s specific targeting of the EU could cause European growth to falter. The EU is the UK’s largest trading partner. Britain exports to Germany and the Netherlands alone more than it does to the US.
“From that perspective, Germany’s massive fiscal plans, which could balance the effects of tariffs, are as important to the UK as is America’s trade war.
“Presently, a UK recession is not a base case scenario. Given that growth is already significantly below trend, however, a recession could very well materialise, especially if the repercussions of trade wars are significant in Europe.”
05:32 PM BST
UK and European stock markets fall as US tariffs edge closer
UK and European stocks fell on Monday as concerns swept through financial markets, days before US president Donald Trump’s tariff plans are due to take effect.
The FTSE 100 fell 0.9pc and the FTSE 250 lost 2pc.
On the Continent, Germany’s Dax fell 1.3pc, and France’s Cac 40 tumbled 1.6pc.
Experts said fears of an escalating trade war meant there was “nowhere to hide in the stock market” with a raft of global stocks caught up in the panic.
Kathleen Brooks, research director at XTB, said: “There is an air of capitulation in financial markets ahead of the April 2 reciprocal tariff announcement from the US.
“Tariff fears have deepened over the weekend, there has been no let-up from president Trump, who said that no country would be able to avoid his reciprocal tariffs. This dashed any hopes for a last-minute reprieve.
“There is nowhere to hide in the stock market as equities get caught up in the tariff headwinds, which is not helped by the fact that it is the last trading day of first quarter.”
Mr Trump has promised a “Liberation Day” on Wednesday, when a series of tariffs tailored to each of the country’s trading partners will come into effect.
04:41 PM BST
Trump ‘scares the market’ with erratic announcements
Stock markets have fallen again and gold hit has hit fresh record high as traders took in Donald Trump’s latest comments on his trade war.
In a conversation on Air Force One with reporters, Mr Trump seemed to dash hopes the levies would be limited to a smaller group of countries with the biggest trade imbalances.
Mr Trump is due to receive tariff recommendations on Tuesday and announce initial levels on Wednesday.
George Lagarias, chief economist at Forvis Mazars, said: “What the Trump administration has shown us so far is that you should not expect a consistent approach.”
“This is what scares the market the most. Inconsistency breeds uncertainty, and markets hate uncertainty.”
Some economists have flagged the risk of stagflation - high inflation accompanied with unemployment and stagnant demand - from an escalating trade war.
Talley Leger, chief market strategist at The Wealth Consulting Group in New Jersey, said: “The current market narratives centre on this fear of stagflation, which conceptually could be the worst possible combination for stocks.
“So in a slowing growth environment, earnings would decelerate, or even collapse in a recession. That’s another big fear in the market. And on the other side, spiralling inflation would squeeze stocks on the valuation channel.”
04:33 PM BST
No 10: ‘We continue to have constructive discussions’
Downing Street has said that it continues to have “constructive discussions” with the Trump administration over tariffs.
The Office for Budget Responsibility has warned that a full-blown trade war, in which the UK responds in kind to Mr Trump’s tariffs, could knock 1pc off gross domestic product and wipe out Ms Reeves’ headroom.
The assessment from the Office for Budget Responsibility helps explain why so far, unlike other economies such as the European Union, Sir Keir’s government has refrained from retaliating against Mr Trump.
The Prime Minister’s spokesman said: “You’ve got the OBR’s modelling and we’ve said previously a trade war with the US is clearly not in anybody’s interests.
“We continue to have constructive discussions on agreeing a deal with the US, but at the same time, we’ve also been clear that all options are on the table, we obviously reserve our right to respond, to protect our protect our industries.
“But we want to take a calm and pragmatic approach to this.
“I think British industry has also been clear that they want to see the Government having a dialogue with the United States and that’s what we’re going to continue to do and seek to achieve.”
04:29 PM BST
Eurozone bonds rise as tariff fears drive investors to safe havens
German bonds rallied on Monday, as investors flocked to the safety of government debt ahead of Donald Trump’s latest tariffs announcement.
Mr Trump has said he will announce reciprocal tariffs on US trading partners on Wednesday. Major global stock markets have fallen sharply today as investors moved out of riskier assets into those deemed to be safe havens.
Mohit Kumar, a senior economist at Jefferies, said: “It’s all about the tariff uncertainty and how many tariffs and counter-measures will be announced.
“The negative scenario for the market would be that April 2 just marks the starting point of negotiation, and we have an extended period of negotiations where there is not much clarity on the tariff structure.”
German bonds are seen as a the benchmark for the eurozone area.
04:25 PM BST
US car workers ‘will suffer’ from Trump tariffs, economists war
US car workers will be hurt by the effects of Donald Trump’s trade war, economists have warned.
Scott Lincicome and Tad DeHaven, of the free-market Cato Institute in Washington DC, said that Mr Trump’s plans for a “permanent” 25pc tax on imported cars and car parts was “foolish”.
US carmakers will be hit by more costly parts and equipment, putting pressure on their margins, they said.
They added: “Burdened with such costs, as well as those from other Trump tariffs (e.g., on steel and aluminium), continued policy uncertainty, and foreign retaliation, it’ll be many US-based automotive manufacturing plants from Michigan to Georgia - and their workers - that suffer.”
But they concluded that “the biggest losers will be lower- and middle-income Americans”.
04:04 PM BST
China, Japan, South Korea team up to respond to US tariffs
China, Japan and South Korea will jointly respond to US tariffs, a social media account affiliated with Chinese state broadcaster CCTV has said.
The comments came after the three countries held their first economic talks in five years yesterday. The three countries are seeking to accelerate regional trade as the Asian export powers brace against Donald Trump’s trade war.
During Sunday’s meeting, the countries’ trade ministers agreed to “closely cooperate for comprehensive and high-level” talks on a South Korea-Japan-China free trade agreement deal to promote “regional and global trade”.
Japan and South Korea are seeking to import semiconductor raw materials from China, and China is also interested in purchasing chip products from Japan and South Korea, the account Yuyuan Tantian said in a post on Weibo.
All three sides reportedly agreed to strengthen supply chain cooperation and discuss export controls (rules that limit the export of certain goods).
In December, China banned the export of so-called “critical materials” gallium, germanium and antimony to the US. The ban was in retaliation to US restrictions on exports of advanced chips to China.
Beijing, Seoul and Tokyo are major US trading partners, although they have been at loggerheads amongst themselves over issues including territorial disputes and Japan’s release of wastewater from the wrecked Fukushima nuclear power plant.
03:50 PM BST
Wall Street at over six-month lows as tariffs spark recession fears
The S&P 500 and the Nasdaq hit more than six-month lows on Monday as investors steered clear of shares on worries over Donald Trump’s trade war.
Global stocks tumbled, gold prices scaled new highs and US government bonds climbed after Mr Trump said yesterday that this week’s latest tariffs will include all nations.
US stock markets have dropped this year after Mr Trump’s tariffs raised fears of a global economic slowdown and a spike in inflation.
Daniela Hathorn, an analyst at Capital.com, said: “Quite a lot negativity has been priced in, but markets are bracing for the worst to come.
“The messaging around tariffs softening seems highly unlikely, given Trump’s comments over the weekend.”
The three major US indexes are on track for substantial monthly and quarterly declines. The S&P 500 and the tech-heavy Nasdaq are poised for their steepest quarterly drops in nearly three years.
The S&P 500 is down 0.7pc today, the Nasdaq is down 1.9pc and the Dow is mostly flat.
03:45 PM BST
Oil prices surge after Trump floats new tariffs
The cost of a barrel of oil has surged today by 1.3pc after US president Donald Trump suggested he could impose secondary tariffs of 25pc-50pc on buyers of Russian oil.
The Kremlin has said today that Russia and the United States are working on ideas for a possible peace settlement in Ukraine and on building bilateral ties
This was despite Mr Trump saying that he was “pissed off” with Vladimir Putin.
Mr Trump told NBC News he was very angry after the Russian leader criticised the credibility of Ukrainian president Volodymyr Zelenskiy.
Mr Trump later told reporters he was disappointed with Putin but added: “I think we are making progress, step by step.”
Brent crude, the global benchmark for oil, is at $74.58 a barrel.
03:30 PM BST
Wall Street ‘fear index’ surges ahead of ‘Liberation Day’
Wall Street’s so-called “fear index” surged after Donald Trump said his reciprocal tariffs due on Wednesday would impact “all countries”.
The CBOE Volatility Index jumped as much as 14.6pc at the start of trading before cooling slightly as the S&P 500 dropped 1pc.
The Dow Jones Industrial Average was last down 0.5pc and the Nasdaq Composite was down 2pc.
Kathleen Brooks, research director at XTB, said: “There is an air of capitulation in financial markets ahead of the April 2 reciprocal tariff announcement from the US.
“Global stocks are all in the red.”
Steve Sosnick from Interactive Brokers told AFP: “I think the mood is very nervous out there today.”
Thanks for following today’s live updates. I will leave you in the hands of Alex Singleton who will guide you through the latest on the stock market turmoil, illustrated below:
03:08 PM BST
Britain faces tariffs despite trade surplus with US
Britain will be hit with US tariffs this week despite operating a trade surplus with the world’s largest economy.
Downing Street’s admission that the UK will not avoid Donald Trump’s trade war comes after senior figures hinted that there could be a deal as a result of the “balanced” position between the two countries.
Rachel Reeves said last week that she understands the reasoning behind the President’s tariffs but pointed out that the UK and the US have balanced trade.
“There’s neither a surplus nor a deficit,” she told Sky News.
“The US are concerned - and I get this - about countries that run persistent large surpluses with the US. The UK is not one of those countries which is why we are in extensive talks at the moment.”
The chart below from Capital Economics shows how Britain’s trading relationship with the US differs from other major economies like China.
Britain’s trade talks continue ahead of “Liberation Day” on Wednesday when reciprocal tariffs are due to be announced.
02:54 PM BST
Pictured: Traders battle slump in European stock markets
Brokers at the Frankfurt Stock Exchange have had a busy day as Donald Trump said “all countries” would be hit by reciprocal tariffs from the US this week.
The Dax in Germany and Cac 40 in Paris were both last down 1.6pc, although both are on track for quarterly gains of about 11pc and 5.5pc, respectively.
02:35 PM BST
US stocks plunge in countdown to ‘Liberation Day’
Stock markets fell heavily after the opening bell on Wall Street as Donald Trump said “all countries” would be subject to his reciprocal tariffs being announced this week.
The tech-heavy Nasdaq Composite tanked by 2.3pc to 16,918.12 in New York.
The Dow Jones Industrial Average dropped 0.7pc to 41,302.83 while the S&P 500 declined 1.3pc to 5,508.53.
02:27 PM BST
Griffith: Reeves forgot to include impact of tariffs in sums
The shadow business and trade secretary said the admission Britain will be hit by US tariffs this week would be a blow to Rachel Reeves after she “forgot to include the impact of tariffs” in her Spring Statement.
Andrew Griffith said: “Keir Starmer clearly cannot negotiate his way out of a wet paper bag. This news on tariffs comes as a devastating blow not just to British businesses and workers but to his own Chancellor whose sums last week forgot to include the impact of tariffs.
“Labour have taken to claiming talks with the US are going ‘well’. But if this is what good looks like I wouldn’t like to see the opposite. He seemed to have got less out of his trip to Washington than a tourist with a White House snow globe.
“When it comes to trade, careless words cost jobs. Perhaps if his cabinet had spent less time making juvenile comments or sending Labour staff to campaign for the losing side in the US election, British jobs today would not be in peril.”
02:22 PM BST
US trade war risks ‘drag on global activity’
Many economists believe that trade tensions sparked by Mr Trump will slow economic growth around the world.
The Organisation for Economic Co-operation and Development (OECD) said earlier this month that US trade policy would be a “drag on global activity” and hit living standards around the world.
“Overall, consumers face much of the burden of higher tariffs,” the OECD said in its economic outlook report, with real disposable incomes estimated to decline by $1,600 (£1,237) per household in the US.
In terms of the UK impact, experts say there is a great amount of uncertainty about how tariffs will filter through to households and businesses, especially if the country avoids steep penalties.
Economists at the Bank of England said the effect on inflation in the UK would depend on how other countries respond with their own trade policies, and how foreign exchange rates are affected.
Economist Swati Dhingra, a member of the Bank’s Monetary Policy Committee, has said the UK is sensitive to changing import prices.
But she suggested that the inflation impact could be “less than feared” because the main goods that the US imports from the UK, including refined oil, were unlikely to see cost increases on account of tariffs.
The Bank, which sets UK interest rates, said it was a “rapidly evolving situation” that it was monitoring closely.
02:01 PM BST
Davey tells Starmer to use reciprocal tariffs ‘if necessary’
Sir Ed Davey said Sir Keir Starmer must be prepared to impose reciprocal tariffs against the US after Downing Street admitted Britain would not be spared from Donald Trump’s trade war.
The Liberal Democrat leader said: “This news will be deeply worrying to the millions already struggling with the worst cost of living crisis in a generation.
“Ministers have rightly tried to avoid Donald Trump imposing his destructive tariffs on British businesses – but as we knew all along, Trump doesn’t care.
“Just asking nicely clearly doesn’t work with Trump, so we have to stand tall with our allies in Canada and Europe and show that we will not be bullied.
“That means being prepared to impose reciprocal tariffs if necessary, including on Elon Musk’s Teslas, and urgently negotiating a better trade deal with the EU to show Trump we have alternatives.”
01:45 PM BST
FTSE 100 outperforms Wall Street amid tariff sell-off
The FTSE 100 was on track for its worst day since August today but Britain’s flagship stock market has still massively outperformed its US peers.
The index has gained 4.4pc during the first three months of this year, which is its best performance since the final quarter of 2022.
By contrast, the S&P 500 has fallen by 4.9pc so far in 2025, which is its worst month since the third quarter of 2022.
The Nasdaq Composite, which is home to the technology companies that have driven the surge on Wall Street in recent years, has plunged by 10pc since the turn of the year.
This is its worst performance since a 22.4pc plunge in the three months to June in 2022.
Kathleen Brooks, research director at XTB, said: “The sell off in the S&P 500 so far this year has been led by Tesla and big tech, however, in recent weeks the US blue chip index’s sell off has gathered pace and has broadened to sectors that are exposed to the consumer.
“Some of the worst performing stocks on the S&P 500 in the past month are linked to fears about consumers reigning in their spending: Delta Airlines is lower by 27pc, United Airlines is down by 25pc, Ralph Lauren is lower by 20pc and Lululemon is lower by 19pc.
“The decline in consumer stocks is worth noting, it suggests that investors see US consumers bearing the brunt of the pain from tariffs, which could be counter productive for President Trump.”
01:23 PM BST
German inflation falls further than expected
Germany’s inflation rate fell further than expected in March, preliminary data showed, offering some small relief before Donald Trump hits the world with tariffs.
Annual inflation in Europe’s largest economy was 2.3pc in March, federal statistics agency Destatis said, which was down from 2.6pc the previous month.
Analysts had expected the harmonised rate - adjusted for the European Central Bank - to drop to 2.4pc.
01:04 PM BST
FTSE 100 plunges as hopes of evading Trump tariffs evaporate
The FTSE 100 slumped further after Donald Trump said his reciprocal tariffs would cover all countries, despite the UK’s best efforts to secure exemption.
Sir Keir Starmer said there had been “productive negotiations” toward a UK-US economic prosperity deal during a Sunday phone call, but Downing Street has admitted Britain will be impacted by the American levies this week.
The FTSE 100 fell as much as 1.4pc as it was weighed down by a nervous mining sector also staring down the barrel of Mr Trump’s car levies.
The mining sector fell as much as 2.8pc to its lowest intraday level since September, with Glencore dropping 4.4pc, Anglo American falling 4.3pc and Rio Tinto sliding as much as 3.9pc.
Primark owner Associated British Foods dropped 2.7pc after it announced the retailer’s boss Paul Marchant had resigned with immediate effect following an allegation made by an individual about his behaviour.
British Airways operator International Airlines Group fell the furthest, dropping as much as 6.6pc after rival Virgin Atlantic warned that demand among Americans for flights to the UK had slowed.
Astrazeneca and HSBC delivered the biggest blows to the FTSE 100 amid the uncertainty, falling as much as 2.2pc and 2pc respectively.
British American Tobacco and Imperial Brands were among the few risers, ticking up 1.4pc and 2.2pc respectively, as each were bolstered by share buyback programmes.
12:44 PM BST
Stroll backs Aston Martin in face of tariff threat
The billionaire owner of Aston Martin has increased his backing for the luxury car maker as it battles huge losses and Donald Trump’s trade tariffs.
In a show of support, executive chairman Lawrence Stroll said his consortium, Yew Tree, had increased its holding in the company from 27.7pc to about 33pc.
The stake sale will see the car maker receive £52.5m. Aston is also selling its remaining stake in Stroll’s Formula 1 team for another £74m, taking the combined cash raise to more than £125m.
The deals will generate much-needed cash for Aston as it braces for the impact of US tariffs on cars imported from Europe and grapples with continued losses.
Aston is the most exposed of any luxury car maker, according to Bank of America, with more than 29pc of its sales made in America.
Since 2020, Mr Stroll has pumped around £600m into the struggling business as part of turnaround efforts.
He said: “I am pleased to clearly demonstrate my unwavering support and commitment to Aston Martin.
“This further underscores my conviction in this extraordinary brand, and commitment to ensuring Aston Martin has the strongest possible platform for creating long-term value.”
Aston shares led the FTSE 250 after climbing 6.8pc following the announcement. They are down 35pc so far this year.
12:37 PM BST
Britain will be hit by Trump tariffs, No10 admits
Britain will be hit by Donald Trump’s “Liberation Day” tariffs, Downing Street has admitted for the first time.
Sir Keir Starmer’s Government had been hoping to secure a carve-out amid ongoing trade talks between the UK and the US.
But there was a blow for Sir Keir on Monday as Mr Trump confirmed that tariffs to be introduced on Wednesday will hit “all countries”.
The Prime Minister’s official spokesman said: “When it comes to tariffs, the Prime Minister has been clear he will always act in the national interest, and we’ve been actively preparing for all eventualities ahead of the expected announcements from President Trump this week, which we’d expect the UK to be impacted by alongside other countries.
“Our trade teams are continuing to have constructive discussions to agree a UK, US economic prosperity deal.
“But we will only do a deal which reflects this government’s mandate to deliver economic stability for the British people. And we will only act in the national interest.”
The spokesman also refused to rule out retaliatory tariffs on the US financial sector, insisting Sir Keir would take a “pragmatic” approach while not ruling anything out.
12:14 PM BST
US travel demand to UK slows amid fears of downturn, warns Virgin Atlantic
Virgin Atlantic has warned of a slowdown in US travel demand to the UK, amid mounting uncertainty among American consumers over Donald Trump’s economic policies.
Oliver Byers, chief financial officer, said ticket sales on flights from the US had flagged in recent weeks.
“In the last few weeks we have started to see some signals that US demand is slowing,” he said, adding that the spring travel season is “the period where we’re seeing some weakness”.
The company, founded by billionaire Sir Richard Branson, reported a profit before tax and exceptional items of £20m for 2024 - its first profitable year since 2016.
Virgin Atlantic’s warning triggered a slump for European airline stocks.
British Airways operator International Airlines Group dropped as much as 6.6pc, making it the worst performer on the FTSE 100, while Air-France KLM was down 5.3pc and Lufthansa fell 4.3pc.
Other US airlines have voiced concern as Americans rein in spending habits, with Delta Air Lines halving its profit outlook at the start of the year and American Airlines Group doubling its forecasted first quarter losses.
12:01 PM BST
France fines Apple €150m despite Trump tariff threat
French competition authorities have fined Apple €150m (£125m) in a move that threatens to invoke Donald Trump’s ire days before the President introduces new tariffs.
The Autorité de la Concurrence imposed the fine over Apple’s app tracking transparency (ATT) system, which affects how third-party apps can collect data on users.
Apple introduced the technology in 2021 to limit what information apps can gather but the autorité said the company had not applied the same terms to its own services.
The EU is set to hit Apple and Meta with further fines in the coming days as it concludes its first investigations under new Big Tech legislation. However, the penalties are expected to be limited in an attempt to avoid provoking a response from the US.
Mr Trump has said the EU laws known as the Digital Markets Act could lead to extra tariffs. Last year, he said that Apple chief executive Tim Cook had called him to complain about EU regulation.
ATT requires users to opt in to their activity being tracked across different apps and developers have said it makes it more difficult to target advertising.
11:47 AM BST
Wall Street poised for slump in countdown to ‘Liberation Day’
US stock indexes tumbled in premarket trading amid concerns that Donald Trump’s reciprocal tariffs will hit the global economy.
Markets have succumbed to sharp selling pressure this year after the US president announced tariffs on some of America’s main trading partners, raising fears of a global economic slowdown and a spike in inflation.
Mr Trump, who sees tariffs as a way of protecting the domestic economy from unfair global competition, has promised to unveil a massive tariff plan on Wednesday, which he has dubbed “Liberation Day”.
Wall Street’s main indexes were set for big monthly and quarterly declines, with the benchmark S&P 500 and the tech-heavy Nasdaq set for their worst quarterly performances in about three years.
Tech stocks were at the forefront of the sell-off in New York ahead of the opening bell, with Nvidia sliding 3.6pc, Microsoft down 1.6pc and Tesla dropping 4.7pc.
In premarket trading, the Dow Jones Industrial Average was lower by 0.6pc, the S&P 500 had dropped 0.9pc and the tech-heavy Nasdaq had fallen 1.3pc.
11:28 AM BST
Pound rises against dollar as Trump tariffs raise US recession fears
The pound was on track for its best month against the dollar in more than a year as Donald Trump prepared to impose reciprocal tariffs which could trigger a downturn in the world’s largest economy.
Sterling was on track to climb nearly 3pc against the US currency during March, which would be its best month since November 2023.
The pound was last down 0.1pc on the day to $1.292 after the US president hinted that all countries would be slapped with the duties this week, despite “productive negotiations” with Sir Keir Starmer on a potential trade deal in a call on Sunday.
Michalis Rousakis and Claudio Piron of Merrill Lynch said: “Across-the-board tariffs would be a negative surprise, in our view.
“Our main concern is ‘something breaking’ from aggressive tariffs, triggering a tail risk of a sharp market sell-off, pushing the dollar much higher in the short term.”
The Japanese yen - considered a safe haven in times of turmoil - was up as much as 0.7pc against the dollar.
The dollar has been under pressure from a flight to the safety of US Treasuries, which sent the yield on the 10-year note sliding more than six basis points to 4.19pc on Monday.
Jane Foley, head of FX strategy at Rabobank, said: “I think only one thing can be said with certainty is that the uncertainty will not end with the announcement of the reciprocal tariffs by Trump on April 2.
“This week is quite a big data week for the US, particularly with payrolls data at the end of the week and it seems that the market is a little bit reluctant to buy the dollar.”
11:13 AM BST
Wall Street doubles US recession risk as Trump tariffs loom
The US economy is more than twice as likely to plunge into recession this year, Wall Street has predicted, as Donald Trump prepares to unleash tariffs across the globe.
Moody’s, the credit ratings agency, has raised the odds of a recession in the world’s largest economy to 40pc, up from 15pc at the start of the year, while Goldman Sachs, the investment bank, said the probability of a recession had hit 35pc, up from 20pc.
Both blamed the new ratings on weaker consumer confidence and a likely acceleration of inflation.
Moody’s chief economist Mark Zandi warned that mounting tariffs and cuts by Elon Musk’s Department of Government Efficiency (Doge) were raising the risk of a downturn.
He said: “The intensifying trade war and Doge cuts are behind all this and with last week’s announcement of big tariff increases on vehicle imports and the coming reciprocal tariffs, things are sure to get worse.”
Goldman Sachs said it now expected reciprocal tariffs to be “more aggressive”, averaging 15pc across US trading partners.
10:51 AM BST
Trump tariffs should trigger ‘march to independence’, says Lagarde
Donald Trump’s looming tariffs should kickstart a “march to independence” for the EU, Christine Lagarde has said.
The head of the European Central Bank said the US president’s 25pc tariff on the motoring sector presented an opportunity for Europe.
“I consider it a moment when we can decide together to take our destiny into our own hands, and I think it is a march to independence,” she told France Inter Radio.
“We are at an existential moment for Europe in which if we are able to take this step to independence, in terms of defence - which is not my topic so I won’t speak of that - energy and finance, which is much more my subject - we must absolutely take the reins now.”
Ms Lagarde also warned that the bank could not relent on inflation, as Mr Trump’s trade wars continue to brew uncertainty.
“It is a daily struggle,” she said. “We are almost where we should be, but we have to remain there, so that’s why I say it’s a constant battle.”
Policymakers have cut interest rates in six quarter-point moves since June, though there is a split forming over whether to carry on cutting at the April 17 decision.
She said: “We are all absolutely determined to arrive at this target, which is a target of 2pc.
“In terms of the path to get there, some want to gallop, to go very fast. Others say let’s do a small trot, let’s wait to see what the obstacles are along the way.”
While the bloc’s growth outlook has been buoyed by touted expansion of Germany’s public spending, confidence has been hampered by the planned announcement of Mr Trump’s reciprocal tariffs on April 2.
10:30 AM BST
US tariffs worth £600bn risk stoking inflation, warns UBS
The US is at risk of a surge in inflation if Donald Trump presses ahead with $770bn (£595bn) worth of tariffs this week, according to UBS.
The investment bank said the US president’s levies could push core inflation in the world’s largest economy close to 3pc, while dragging down growth over the next three years.
It estimated the US has put forward $770bn of tariffs, equivalent to levels last seen in 1933, but warned that if this included other countries’s VAT rates, this would rise as high as $1.1 trillion.
Economist Arend Kapteyn said: “We will wait to see the full set of tariff announcements, but it’s possible that we have to revise our existing 1.6pc fourth quarter growth forecast for the US this year substantially lower.
“The US will face the combined impact of all the tariffs it imposes on its trade partners, whereas its trade partners will face only the US tariffs.”
10:05 AM BST
Britain has ‘decent chance’ of avoiding tariffs, says ex-Trump adviser
Kelly Ann Shaw, a former trade adviser to Donald Trump, said Britain has a “decent chance” of avoiding tariffs if the US president takes a more “targeted” approach with them.
She told BBC Radio 4’s Today programme: “What I would say is, it’s not clear that any country is going to get an exemption.
“And what has been interesting is that over the past 48 hours, there have been a number of reports in Washington that the President is considering potentially going back to this concept of a universal baseline tariff that would apply to all countries.
“Now, while he’s pending final decision, assuming he moves forward with a plan to be more targeted, which was floated the last two weeks by many of his senior advisers, I do think that the UK has a decent chance.
“They’ve got a trade surplus with the United States, relatively balanced trade, and the two leaders seem to be off to a good start.”
09:42 AM BST
Government borrowing costs drop as investors snap up bonds
The cost of government borrowing has dropped as Donald Trump’s tariff comments meant investors turned to the safe haven of bonds.
The yield on 10-year UK gilts - a benchmark for the cost of UK government debt - fell three basis points to 4.66pc amid a global bond market rally.
Traders have raised bets on the likelihood of interest rate cuts later this year ahead of the US president’s April 2 deadline for his reciprocal tariffs, which are expected to hit the world economy.
Money markets indicate the Bank of England will cut rates twice this year, with a second cut by November, compared bets on Friday of December. Traders are now pricing in three cuts by the Fed this year, compared to two last week.
Jefferies chief financial economist Mohit Kumar said: “It’s all about the tariff uncertainty and how much tariffs and counter measures will be announced.
“Reports indicate that Trump prefers a broader set of tariffs across all countries, rather than targeted measures which were previously reported.
“It would set the stage for further negotiations, suggesting either that current negotiations haven’t gone well, or that Trump wants to make a big headline policy announcement (the ‘Liberation Day’ speech) and then selectively agreeing to deals with individual countries.”
09:20 AM BST
Oil prices rise as Trump considers tariffs on Putin’s crude
The price of oil has risen after Donald Trump said he could impose “secondary tariffs” on countries that buy Russian oil.
Brent crude, the international benchmark, rose 0.6pc to more than $74 a barrel after the US president said he was “very angry” at Vladimir Putin for demanding that Volodymyr Zelensky be removed as Ukraine’s leader for peace talks to go ahead.
Mr Trump threatened levies on “all oil coming out of Russia”, helping lift the price of US-produced West Texas Intermediate crude up 0.5pc towards $70 a barrel.
It comes as the US on Sunday revoked several transnational oil and gas companies’ licences to operate in Venezuela, which had been granted despite Washington’s sanctions against the South American country.
US President Donald Trump announced a week ago 25pc tariffs on imports from countries buying Venezuelan oil and gas.
Venezuela did not specify which companies were affected but French oil firm Maurel & Prom (M&P) said today that the special licence it had been granted last May had been revoked.
08:58 AM BST
European stocks slump as Trump pledges tariffs
European shares fell on Monday, as cautious investors fled risky bets after Donald Trump said that tariffs would target all countries, fuelling fears of a global economic slowdown.
The pan-European Stoxx 600 was down 1.1pc, while the benchmark stock indexes in Germany and France, the Dax and Cac 40, were both down nearly 1pc.
Wall Street stocks are also expected to open sharply lower after Mr Trump’s comments over the weekend prompted a rush to the safety of gold and Japanese yen.
Investors are bracing for reciprocal tariffs on US trading partners on Wednesday, April 2, which the President has called “Liberation Day” for the world’s largest economy.
08:51 AM BST
Brompton Bicycle to hold off US investment over tariff threat
The boss of Brompton Bicycle said his company will hold off investing in the US as Donald Trump threatens to deepen his trade war.
Will Butler-Adams said the US president’s levies would be “counterproductive” as it would stop companies like his expanding into America.
He said US imports staff “don’t actually don’t entirely understand how some of these tariffs might be put in” which meant companies were scrambling to understand if their supply chains contained products such as steel from outside the US, which are subject to levies.
Brompton Bicycle has been a distributor in the US for nearly 20 years, growing from employing three people to 40, with shops in New York and Washington.
Mr Butler-Adams said: “We’re not big enough to open a factory in the US, so ironically, if he puts bigger taxes on, actually he’s going to make our product less competitive, we won’t continue to invest in the same way that we are now.
“We may even shrink. In the extreme we might pull out, never growing to a size and scale where we’d be in a position to open up a facility in the US.”
He added: “In the US there is an opportunity. We’ve developed a product for the US. But do we really want to pile-in at this minute in time? No, we’ll be just holding off for the moment.”
08:26 AM BST
Important we keep a cool head, says Eagle
Dame Angela Eagle has said that it is “important” the UK keeps a “cool head” in the face of looming tariffs, but pledged that “we will look after the UK interest”.
The Home Office minister was asked what the UK’s plan was for the tariffs set to be introduced by Donald Trump later this week.
She told Times Radio: “We have balanced trade with the US, but obviously we will look after our interests.
“I think it’s important - they’re a big trading partner for us - it’s important that we keep a cool head, but we will look after the UK interest.”
Asked whether the Government would retaliate with reciprocal car tariffs, Dame Angela declined to get into a “running commentary” but added: “What I’ve said is the principle of what we’re doing is ensuring that our national interests are protected, but what we’re trying to do is come to an agreement with the US administration that will help the economic prosperity of both of our nations.”
08:06 AM BST
UK stocks sink as trading begins
The FTSE 100 dropped sharply as trading began after Donald Trump threatened tariffs “on all countries” this week.
The UK’s benchmark stock index fell 0.8pc to 8,585.87 while the midcap FTSE 250 dropped 0.7pc to 19,717.39.
08:04 AM BST
Goldman Sachs ramps up bets on rate cuts in face of Trump tariffs
The Federal Reserve and European Central Bank will cut interest rates three times this year as Donald Trump’s tariffs hit growth, a Wall Street bank has predicted.
Goldman Sachs said the US central bank would cut rates in July, September and November, having previously forecast two reductions this year and one in 2026.
Its economists said the ECB will lower borrowing costs in April, June and July as the world adjusts to the new US tariff regime.
It comes as the Bank predicts the Fed’s preferred measure of inflation - the core personal consumption expenditures (PCE) index - to hit 3.5pc by the end of the year.
Meanwhile, US GDP is forecast to be half a percentage point weaker at 1pc in the final three months of the year.
Economist Jan Hatzius said: “The downside risks to the economy from tariffs have increased the likelihood of a package of 2019-style ‘insurance’ cuts, which we now see as the modal outcome under our revised economic forecast.”
“While the Fed leadership has downplayed the rise in inflation expectations so far, we think it does raise the bar for rate cuts and in particular puts greater emphasis on a potential increase in the unemployment rate as a justification for cuts.”
07:46 AM BST
Trump slump sends Japan’s stock market into correction
Tokyo’s Nikkei index closed down more than 4pc as investors were spooked by Donald Trump’s latest comments on tariffs.
The benchmark Nikkei 225 index ended down 4.1pc, or 1,502.77 points, at 35,617.56 - its lowest level since September.
It meant the market entered correction territory, having fallen 10pc from its peak in December.
The broader Topix index was down 3.6pc, or 98.52 points, to 2,658.73.
07:38 AM BST
Gold surges to record high as US levies loom
The price of gold has surged to a fresh record high at the start of the week after Donald Trump threatened tariffs on “all countries” this week.
Bullion gained as much as 1.6pc to top $3,127 an ounce as the US president was expected to unveil his reciprocal tariff plans on his so-called “Liberation Day” on Thursday.
Gold, which is considered a safe-haven asset by investors, hit a record high on Friday and has climbed for four consecutive weeks amid concerns about the outlook for the world economy.
It has risen about 18pc this year and has hit at least 15-record highs in 2025.
07:37 AM BST
Stocks plunge as Trump vows tariffs on ‘all countries’
Stocks have plunged overnight as Donald Trump said he would issue tariffs on “all countries” and threatened to impose levies on Russian oil.
The Nikkei 225 in Japan sank by 4pc to 35,644.96 while the Kospi in South Korea dropped 2.9pc to 2,483.24 as markets continued the downturn from the end of last week. The Hang Seng in Hong Kong lost 1.3pc to 23,119.70.
Mr Trump has promised a “Liberation Day” on Wednesday, when he is set to unveil reciprocal levies to address trade practices that his government deems unfair.
Tariffs on car imports to the American economy are due to come into force on Thursday.
“You’d start with all countries, so let’s see what happens,” Mr Trump told reporters onboard Air Force One, dashing hopes he might scale back some of the threatened levies.
Sir Keir Starmer was ready to deploy “sharp teeth” against the US if Mr Trump hits the UK with tariffs this week, a source at Downing Street said.
European stock indexes were on track to open lower after the US president also said he was “very angry” with Vladimir Putin for demanding that Volodymyr Zelensky be replaced as the price for peace negotiations.
“If a deal isn’t made, and if I think it was Russia’s fault, I’m going to put secondary sanctions on Russia,” Mr Trump told NBC.
He said the levies would be targeted on “all oil coming out of Russia.” He said he plans to speak to Putin this week.
07:24 AM BST
Good morning
Thanks for joining me. Stock markets have fallen heavily after Donald Trump said he would impose tariffs “on all countries”.
The US president said he was also “very angry” with Vladimir Putin over his attempts to oust Volodymyr Zelensky in Ukraine peace negotiations, adding he could impose levies on Russian oil.
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What happened overnight
Asian shares were sharply lower, with Tokyo’s Nikkei 225 falling more than 4pc after another wipe-out slammed Wall Street.
Thailand’s SET lost 1.5pc after a powerful earthquake in Myanmar killed at least 1,700 people.
Tokyo’s benchmark fell 4pc to 35,644.96, while the Hang Seng in Hong Kong lost 1.3pc to 23,119.70.
The Shanghai Composite index declined 0.5pc to 3,335.75.
In South Korea, the Kospi fell 2.9pc to 2,483.24, while Australia’s S&P/ASX 200 sank 1.7pc to 7,843.40.
Taiwan’s Taiex lost 4.2pc to 20,695.90.
US markets ended Friday on another downbeat note, with the Dow falling 1pc and the tech-heavy Nasdaq dropping by 2.4pc amid concerns about inflation brought about by Donald Trump’s trade wars.
Today marks the last day of a quarter that is on track to be Wall Street’s worst since 2022. The S&P 500 is down almost 5pc so far this year.