In the past week (Feb. 21–27), the Nasdaq index, centered on U.S. technology stocks, fell 7%, while the Standard and Poor's 500 index dropped over 4%, raising concerns that global funds may further exit the United States. This is due to President Donald Trump's unpredictable tariff policy. Additionally, with an increase in unemployment numbers, signals indicating instability in the U.S. economy are exacerbating this possibility.
On the 28th, Park Sang-hyun, a researcher at iM Securities, noted that "with the expansion of uncertainty in Trump's policies, it is uncertain whether the U.S. dollar will play a safe-haven role like it did in the first term (January 2017–January 2021)," adding that "indiscriminate tariff policies could strengthen the stimulus measures of Non-U.S. countries."
Earlier, President Trump decided to impose a 25% tariff on Canada and Mexico but postponed it for a month. If things went as planned, it would take effect from April 4, but at the first ministerial meeting held on the 26th of this month, President Trump made remarks suggesting that the tariff implementation could be delayed until April 2.
However, on the previous day (local time), President Trump stated via social media that "an unacceptable level of drugs continues to flood into our country from Mexico and Canada." He added, "We cannot allow this disaster to keep harming the United States, and thus the tariff plan set to take effect on March 4 will be implemented as scheduled until it is stopped or severely restricted."
Researcher Park emphasized that "the possibility cannot be ruled out that President Trump may announce a tariff delay just before the implementation of the tariffs," but he stated that "global financial markets will continue to bear Trump's volatility risks for the time being."
In the meantime, the U.S. economy is not supporting the situation. In the third week of February (Feb. 16–22), the number of weekly new jobless claims in the U.S. reached 242,000, an increase of 22,000 compared to the previous week, marking the highest level this year. Researcher Park projected that "if the current policy stance continues and the risk of policy uncertainty increases, it would be difficult to exclude the possibility of even the solid job market shaking."
Researcher Park assesses that the risk of U.S. economic slowdown due to uncertainty in President Trump's policies will weaken the sustainability of tariffs. He stated, "If prices and the job market are shaken, the risk of U.S. economic slowdown will naturally widen," adding that "this will also act as a significant burden on the U.S. stock market." Considering the characteristics of the U.S. economy, which has a high degree of external dependence from both industrial and demand perspectives, high tariffs are not a sustainable policy.
Researcher Park stated that "if the pressure of economic slowdown in the U.S. becomes more visible due to policy uncertainties, (the U.S.) may shift its policies, such as enhancing tax cuts and other pro-corporation measures," and he indicated that "waiting is necessary at least until the first half of the year." He further added that "the preference for Non-U.S. investments by global funds may continue until there is a policy change by President Trump."