Sovereign bonds of Pakistan, Sri Lanka and Indonesia came under pressure on Friday after the United States announced new tariffs on dozens of trading partners, with the Pakistan 2036 issuance falling 0.5 percent to bid at 97.80 cents.
The declines followed an announcement by US President Donald Trump of fresh tariffs of 10 percent and 12.5 percent on goods from 60 trading partners, citing lax enforcement of bans on forced labour. The new levies were unveiled just as a temporary 10 percent global tariff was set to expire.
Indonesia bonds maturing in 2045 matched the losses seen in Pakistan debt, also falling 0.5 percent to bid at 88.48 cents. Sri Lanka bonds due in 2033 shed just over 1 cent to bid at 93.05 cents on the dollar. The United States remains the largest single export market for Sri Lanka, accounting for roughly $3 billion in shipments, most of it apparel.
The new 10 percent tariff applies to Argentina, Bangladesh, Britain, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, and Trinidad and Tobago.
The European Union, Taiwan, Japan, South Korea and Switzerland were assigned rates that, when combined with existing most-favoured-nation tariffs, would reach a total of 10 or 12.5 percent.
The measure marks the latest attempt by the White House to revive a near-global tariff regime envisioned by Trump during his campaign, after the US Supreme Court struck down his earlier reciprocal duties of 10 to 50 percent in February. Those duties had been imposed the previous year under a national emergencies law aimed at narrowing the US trade deficit.
The tariffs were announced Thursday in a Federal Register notice and cover 99.4 percent of US imports, though numerous product categories are exempt, including oil and gas, fertiliser, and certain food items.
