How Will Donald Trump's Tariffs Affect the Strength of the Dollar? Will the US Enter a Recession? Here's the Opinion of Bank of America

According to currency analysts at Bank of America, if U.S. President Donald Trump proceeds with comprehensive tariffs, the strength of the U.S. dollar may not be sustainable.

In a recent report, Athanasios Vamvakidis and Claudio Piron noted that targeted tariffs on certain products are already expected by the market, but broader trade restrictions would be an "unpleasant surprise." They warn that, especially considering concerns about a potential economic slowdown in the U.S., new tariffs could lead to further uncertainty.

"We believe that the risks will be balanced before the deadline next week. The imposition of tariffs on certain products is already expected by the market. Comprehensive tariffs would be an unpleasant surprise. When comprehensive tariffs are implemented, it is not expected that the dollar will continue to strengthen, and the market is still concerned about the slowdown of the US economy," they said. They also pointed out that logistical issues could delay the implementation of new customs tariffs and leave room for potential negotiations.

Trump's customs tariff strategy has raised widespread concern among the economy and business circles, particularly in Japan. On March 26, Trump signed a declaration imposing a 25% customs tariff on imported cars at the White House, which will take effect on April 2. This move has drawn criticism from international trade experts and automobile manufacturers who fear significant disruptions in global supply chains.

Hideo Kumano, chief economist at the Dai-ichi Life Research Institute, warned that the likelihood of economic benefits from such protectionist policies is low and they could pose risks to the broader global economy instead. Kumano stated, "The U.S. tariff policy has no positive effect and will bring risks to the global economy."