US President Donald Trump said he plans to start his reciprocal tariff push with "All countries," curbing speculation that he could limit the initial scope of the levies. He said he "Couldn't care less" if firms raise prices in response.

Trump, in his second term, is also least worried about the deep sell-off in global markets. Stagflation fears are rising and will constrain the Federal Reserve's ability to cut rates further.

A roller-coaster quarter for markets came to an end. But Trump's policies and stagflation fears are driving investors out of riskier assets. European stocks are beating US equities by the most on record. Japanese stocks are in a correction, and gold is at a fresh record high.

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Bets on US recession surge

The US administration is expected to unveil a broad slate of so-called reciprocal tariffs against US trading partners. That is looming as the next potential body blow for markets. Amidst those fears, stagflation emerges as the winning bet.

Like-for-like or reciprocal tariffs will hit US trading partners who have enjoyed strong trade surpluses over the years. The US had its largest trade deficit with China at 295.4 billion dollars last year.

The next is with the European Union, with America's trade deficit at 235.6 billion dollars in 2024. Followed by Mexico at 171.8 billion dollars and Vietnam at 123.5 billion dollars. The US trade deficit with Ireland and Germany stood at over 80 billion dollars.

Taiwan, Japan, South Korea and Canada accounted for over 60 billion dollars. Trade deficit with India, Thailand and Italy were at over 40 billion dollars last year. US deficit with Switzerland stood at a touch below 40 billion dollars in 2024.

Comparitively, Malaysia, Indonesia, France, Austria, and Sweden had a smaller deficit with the US, so with Trump calling for reciprocal tariffs, all those countries are likely to face equivalent U.S. import levies.

The countries that are likely to be spared on Trump's so-called 'Liberation Day' are the Netherlands, South and Central America, Hong Kong, Australia, and the United Kingdom. In 2024, America had a trade surplus with those countries.

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(With inputs from the agencies)