The weighted average tariff is set to rise from approximately 2.5% to around 20%, marking the highest level in a century. This has sparked concerns about potential dampening effects on global growth and the risk of a recession.
However, there is a possibility that negotiations with global partners could lead to a reduction in these tariffs. Treasury Secretary Scott Bessent mentioned that the announced tariffs might serve as a cap and that countries should not panic. Over 50 countries have already reached out to the White House to begin negotiations.
Historically, markets tend to overreact to such announcements, but they also often recover swiftly. Staying invested during these times is crucial because missing even a single day of a rebound can significantly impact long-term returns.
It's important to remain calm and focus on the long-term perspective, as markets have shown resilience and recovery after past downturns.
We'll continue to monitor the situation closely and keep you informed if our outlook changes. For now, the best approach is to 'hold tight' and navigate through this period with a long-term view in mind.