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Trump Notifies Korea of 25% Reciprocal Tariff Starting August 1st

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US President Donald Trump officially notified South Korea on July 7th (local time) that he would impose a 25% reciprocal tariff on all Korean products starting August 1st. This measure comes after trade negotiations between the US and South Korea, which have been ongoing since April, failed to reach a conclusion, and is expected to have significant impact on the Korean economy and export industries. Key Details of Trump's Tariff Letter President Trump released a letter addressed to President Lee Jae-myung through his social media platform Truth Social. In the letter, Trump stated, "Our relationship has unfortunately been far from reciprocal," and announced that "starting August 1, 2025, we will impose a 25% tariff on all Korean products coming to the United States." This tariff rate is identical to the 25% reciprocal tariff announced by President Trump on April 2nd. While Korea had received a 90-day grace period to conduct negotiations, the failure to rea...

Trump Imposes 25% Tariff on Korea, 3-Week Negotiation Window Opens

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Trump Tariff Ultimatum President Donald Trump has sent an official letter to Korea announcing a 25% mutual tariff on all Korean imports, scheduled to take effect on August 1st. This development marks a significant escalation in US trade policy, affecting Korea along with Japan and at least 12 other countries. Extended Deadline Provides Breathing Room The tariff implementation date was extended from the original July 9th deadline to August 1st, providing Korea with approximately three weeks to negotiate. Trump stated that the 25% rate is actually a low number considering the trade deficit the US has experienced with Korea. Korean Government Response The Korean presidential office assessed that they had avoided the worst-case scenario in tariff negotiations. Policy Chief Kim Yong-beom emphasized that while prompt consultation is important, protecting national interests remains ...

Trump's Tariff Threat: How Will South Korea's Economy Respond?

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President Donald Trump has sent tariff warning letters to major countries including South Korea, announcing a 25% tariff to be imposed starting in August. This trade policy shock is creating ripple effects across the global economy, raising concerns about its impact on South Korea. Economic Ripple Effects Trump's tariff policy extends beyond simple trade conflicts, potentially leading to global inflation deterioration and upward pressure on interest rates. Experts warn that "tariff increases by the hegemonic United States will reduce global trade volumes, leading to GDP decline and economic growth slowdown." The strengthening dollar is intensifying won weakness. The won-dollar exchange rate rose to 1,370 won during Tuesday trading, showing instability. The Bank of Korea's New York office has suggested that the tariff policy's impact on the US economy may be prolonged. Corporate Response Strategies Korean companies are already reviewing various counterm...

LG Electronics Reports 46% Drop in Q2 Operating Profit Amid Tariff Pressures and Weak Consumer Sentiment

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LG Electronics announced a dramatic 46% decline in second-quarter operating profit to 639.1 billion won ($491 million) compared to the same period last year, as the South Korean tech giant grappled with intensifying U.S. trade policies and weakening global consumer demand. Despite revenue growth, mounting operational challenges have significantly impacted the company's profitability across key business segments. Revenue Growth Masks Profit Decline While LG Electronics achieved revenue growth of 8.3% year-over-year to 21.7 trillion won in the second quarter, the sharp profit decline reflects the complex challenges facing global appliance manufacturers. The company attributed the disappointing performance to increased tariff burdens in key markets and widespread consumer hesitancy to make major appliance purchases. The Home Appliance & Air Solution (H&A) division, traditionally LG's profit engine, experienced the most severe impact. Sales of major appliances incl...

Trump Imposes 25% Reciprocal Tariffs on Korea: 2025 Trade War Analysis and Response Strategies

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In July 2025, Donald Trump's announcement of a 25% reciprocal tariff on South Korean goods has sent shockwaves through the Korean economy and global markets. This tariff is part of a massive trade war affecting 183 countries worldwide, representing one of the most significant trade policy shifts in recent history. Understanding the implications and response strategies is crucial for businesses, investors, and policymakers. 🔥 Understanding Trump's Reciprocal Tariffs Reciprocal tariffs are Trump administration's response to what they perceive as "unfair trade advantages" taken by various countries in their trade relationships with the United States. The tariff rates are calculated based on the US trade deficit with each nation, reflecting Trump's core belief that trade deficits represent American losses. 💡 2025 Reciprocal Tariff Overview Country Tariff Rate Effective Date ...

South Korea-US Mutual Tariff Negotiations Begin, Seoul Seeks Extension

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Critical bilateral talks between South Korea and the United States regarding mutual tariffs commenced on July 5th in Washington, as the deadline for the current grace period approaches on July 8th. High-Stakes Diplomatic Mission Trade Minister Yeo Han-koo arrived in Washington to engage in intensive negotiations with US Trade Representative Jamieson Greer and other senior officials. The discussions represent a crucial juncture in South Korea-US economic relations, with potentially far-reaching implications for bilateral trade. The Trump administration has significantly escalated pressure by raising the proposed mutual tariff rate from 50% in April to as high as 60-70%, creating urgency for both sides to reach an agreement. Background and Current Situation The mutual tariff implementation date has already been adjusted once, moving from July 9th to August 1st. However, with the current grace period set to expire on July 8t...

China Unlikely to Sell US Treasury Bonds on Large Scale Despite Trade Tensions

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Trade War Escalation Raises Bond Market Questions As US-China trade tensions intensify under President Donald Trump's expanded tariff policies, speculation has emerged about China's potential to retaliate by selling its massive holdings of US Treasury bonds. However, financial experts argue that practical constraints and economic risks make such extreme measures unlikely, despite growing anti-tariff sentiment in China. China's Treasury Holdings as Economic Leverage China currently holds approximately $780 billion in US Treasury securities, making it the second-largest foreign holder after Japan. This substantial position has led some analysts to suggest that China could weaponize these holdings to pressure the US economy by triggering bond market instability. The theoretical impact of such a move would be significant. A large-scale sell-off could potentially drive up US interest rates, increase borrowing costs for the federal government, and create broader financia...