“It is important to avoid actions that could further harm the global economy,” stated Georgieva in a communication on Thursday, as Washington’s trading partners consider retaliatory measures against the tariffs announced by Trump.
“We are still assessing the macroeconomic implications of the announced tariff measures, but they clearly pose a significant risk to the global outlook at a time of weak growth,” Georgieva said.
“We urge the United States and its trading partners to work constructively to resolve trade tensions and reduce uncertainty,” she added.
The higher-than-expected tariffs by Donald Trump triggered a drop in global markets for the dollar, oil, and stocks on Thursday, with financial markets anticipating a decline in growth and global trade.
Wall Street closed sharply lower, with the S&P500 and the Nasdaq experiencing the worst declines in five years.
Session results show that the Dow Jones Industrial Average fell by 3.98%, the tech-heavy Nasdaq dropped by 5.97%, marking the worst performance since March 2020, and the broad S&P500 declined by 4.84%, the largest loss since June 2020.
The devaluation of stocks on Thursday is estimated to be in the billions of dollars.
The stock market was shaken by the new tariffs introduced by Trump on Wednesday, causing panic across most markets.
These tariff increases are particularly burdensome for Asian and European Union exporters, prompting threats of retaliation that could stifle the economies of the targeted countries, as well as that of the United States.
The White House’s unprecedented move since the 1930s introduces supplementary tariffs of 10% and increases for some countries: 20% for the EU, 34% for China, 24% for Japan, and 31% for Switzerland.
“The tariffs are higher and more severe than expected, and it will take time to determine the exact effects not only on the economy but also on corporate profits,” commented Tom Cahill, an analyst at Ventura Wealth Management, speaking to AFP.
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