Asia-Pacific Markets React to Trump's Trade Deal Declaration with China

Asia-Pacific markets exhibited mixed responses on June 11, 2025, as investors assessed U.S. President Donald Trump’s recent declaration that a trade agreement with China was "done." This announcement, made via a post on Truth Social, included details of tariff structures and trade conditions that have significant implications for the global economy.

In his statement, President Trump indicated that Chinese imports would incur tariffs of 55%, while China would face only 10% tariffs on its exports to the U.S. This was confirmed by Commerce Secretary Howard Lutnick, who stated that the tariffs would remain in effect as part of the agreement's framework. Following this news, Japan's benchmark Nikkei 225 index fell by 0.10%, while the broader Topix index saw a slight increase of 0.12%. South Korea's Kospi rose by 0.34%, and Australia's S&P/ASX 200 gained 0.25%.

Traders are also awaiting inflation data from Thailand and the Philippines, which could further influence market sentiments. U.S. stock futures, however, dropped as investors weighed the implications of Trump’s trade deal amidst a backdrop of inflation data that fell short of expectations. The S&P 500 futures were down 0.2%, and futures for the Dow Jones Industrial Average also decreased by 72 points, reflecting broader concerns about the potential economic impact of sustained high tariffs.

Trump’s assertion that the trade deal is "done, subject to final approval with President Xi" drew mixed reactions from market analysts. Ed Yardeni, president of Yardeni Research, noted that the markets might be unsettled by the prospect of ongoing high tariffs and a lack of clarity regarding the nuclear deal negotiations with Iran, which Trump mentioned in the same post. This uncertainty has led to a pullback in equities as the market adjusts to the reality of elevated tariffs.

In addition, ANZ economists expressed concern that the permanence of these tariffs could dampen trade relations and economic growth moving forward. The mixed market performance also mirrors a broader trend within the Asia-Pacific region, where investors are grappling with geopolitical tensions and economic recovery challenges.

As the situation develops, the implications of this trade deal will likely extend beyond immediate market reactions. Economists and industry leaders are calling for careful monitoring of the U.S.-China trade relations, which have historically been fraught with complexities affecting global supply chains and economic stability.

Moving forward, analysts predict that sustained tariffs could lead to increased costs for consumers and businesses alike, which may, in turn, influence inflation rates and overall economic growth. The prospect of further negotiations and adjustments will remain at the forefront of discussions among market participants as they navigate this evolving landscape.

In conclusion, the Asia-Pacific markets’ mixed reactions to President Trump’s declaration highlight the intricate interplay between trade policy and economic performance in a globalized economy. The long-term effects of the trade deal remain to be seen, but they are sure to shape the financial landscape in the coming months.