Asian Currencies Weaken Amid Trump 25% Japan, South Korea Tariffs

Asian currencies weakened amid concerns over new U.S. trade tariffs announced by President Donald Trump, who plans to impose 25% tariffs on imports from Japan and South Korea starting August 1, with some smaller economies facing duties up to 40%. The U.S. Dollar Index rose as markets reacted cautiously to these escalating trade tensions, pressuring regional currencies like the South Korean won, Japanese yen, and Singapore dollar. This development followed a period in Q2 2025 when Asian currencies had rallied against the dollar, but Trump's tariff announcements caused a rebound in the dollar's value and renewed pressure on Asian markets. Analysts warned that countries exposed to these tariffs, particularly Japan and South Korea, could see currency depreciation and stock market declines, especially in sectors like automakers. The tariffs also added to broader concerns about disrupted global supply chains and economic slowdowns in trade-reliant Asian economies. Investors remain watchful of central bank decisions, such as those from the Reserve Bank of Australia and New Zealand, which have also influenced currency movements amid the trade uncertainty.