LONDON: Fears of a trade war spooked emerging market investors bracing for an imminent announcement from Washington, with sto­cks coming under pressure and currencies giving away gains chalked up in the wake of a no-surprise US Federal Reserve rate meeting.

President Donald Trump is expected to announce tariffs on Chinese imports on Thu­rsday in a move aimed at curbing theft of US technology that will likely trigger retaliation from Beijing, stoking fears of a global trade war.

There was no indication of the size and scope of the tariffs, though US trade chief Robert Lighthizer said measures would target China’s high-tech sector and could incl­ude restrictions on Chi­nese investments in the Uni­ted States. China has repe­atedly said it has no wish to fight a trade war, but warned that it is ready to do so.

MSCI’s emerging market equity benchmark fell 0.4 percent, with indexes in mainland China as well as Hong Kong tumbling more than 1 percent. Bourses in emerging Europe, South Africa and Russia also suffered.

“The risks (of a full blown trade war) have definitely increased it blows my mind if Trump would really carry this out without keeping the door open for negotiations,” said Per Hammarlund, chief emerging markets strategist at SEB.

Published in Dawn, March 23rd, 2018