BRICS currencies weaken, greenback robust after Trump threatens tariffs

Investing.com– Currencies of nations underneath the BRICS bloc weakened on Monday, whereas the greenback firmed after U.S. President-elect Donald Trump threatened to impose steep tariffs on the bloc over its makes an attempt to pivot away from the buck.

The Chinese language yuan, South African rand and Indian rupee all weakened between 0.1% and 0.5% in Asian commerce, whereas buying and selling in different currencies was nonetheless closed for the weekend.

The greenback index shot up 0.5%.

Trump on Sunday mentioned he’ll impose “100% tariffs” on imports from the BRICS bloc, successfully blocking them from U.S. buying and selling in the event that they proceeded with plans to introduce their very own foreign money and shift away from the greenback.

Trump mentioned he would search commitments from the bloc in direction of the greenback and that it’ll not create any new currencies to rival the buck.

The BRICS bloc consists of Brazil, Russia, India, China, South Africa, Egypt, Iran, Ethiopia and the United Arab Emirates. It has persistently known as for a brand new international reserve foreign money, and had not too long ago outlined plans for a standard foreign money for commerce between member states. 

Trump’s current tariff risk comes after he threatened to impose further tariffs on China over the alleged movement of illicit medicine into the U.S.. The President-elect has additionally vowed to impose a blanket 10% tariff on all U.S. imports, and has flagged a largely protectionist stance in direction of commerce and immigration. 

Markets concern that Trump’s tariffs will draw retaliatory measures, sparking a renewed commerce conflict between the world’s largest economies.