This week brought yet another pile of smoking evidence that President Donald Trump’s trade war is doing precisely what trade wars do best: sowing chaos, chilling investment, and nudging the global economy toward an industrial-sized migraine.
Fresh purchasing manager indices (PMIs) from Asia and revised data from Europe confirmed what many had already suspected — global manufacturing is buckling under the pressure of arbitrary tariffs and the kind of “strategic uncertainty” only a reality TV presidency could engineer. The damage is not confined to fringe economies; walloping nations represent over 40% of global output. Not bad for a few strokes of a Sharpie.
In the US, manufacturing activity contracted fastest in five months. Over in China, factories sank into their deepest slump since December 2023 — a not-so-subtle reminder that when two economic superpowers hurl tariffs at one another like toddlers with food trays, everyone gets covered in spaghetti.
Alternating tariffs creates significant uncertainty, encouraging firms to sit on their hands. In plainer terms, why invest, hire, or plan for the future when Washington might change its mind before lunchtime?

Even before these latest figures, the mood in Washington was already sombre. At last month’s IMF meetings, the Fund downgraded global growth expectations — again — with Kristalina Georgieva warning that prolonged trade uncertainty was bringing the world perilously close to recession. But, of course, why let that get in the way of a perfectly incoherent trade strategy?
In Asia, the mood was distinctly grim. S&P Global reported collapsing PMIs from industrial powerhouses like South Korea and Taiwan, while Thailand, Malaysia, and Indonesia all registered declines. India, ever the overachiever, stood alone in expansion territory — possibly due to a miracle, or simply a delay in feeling the punch.
A flicker of optimism came from the eurozone, where factory output hit a 32-month high, albeit firmly in contraction. Economists credited this to a potential splurge in military rearmament. The prospect of war is the only thing between European industry and freefall. Comforting.
According to Cyrus de la Rubia from Hamburg Commercial Bank, European manufacturers are currently enjoying fatter margins thanks to cheaper input costs and higher output prices. But don’t get too excited: that’s likely to evaporate once US tariffs reroute Chinese exports toward Europe, intensifying competition. Globalisation: now with whiplash.
Even in the emerging markets, the pain is palpable. South African manufacturers cited global tariff chaos and local political instability for the sixth consecutive month of contraction. In Brazil, factories barely scraped along, while in Mexico, the PMI hit its lowest level since early 2021. The kind of synchronised slowdown makes central bankers reach for the whiskey.
At the Port of Los Angeles, Executive Director Gene Seroka is bracing for months of logistical disruption as firms scramble to rewire their supply chains to dodge Trump’s eye-watering 145% tariffs on Chinese goods. “You don’t just shut off China today and show up in Cambodia tomorrow,” he said. Quite.
Meanwhile, the JPMorgan Global Manufacturing Index for future output expectations fell to its lowest point since October 2022 — a fitting barometer for the age of Trumpian trade policy: part improv theatre, part demolition derby, and all downside.

In the end, the underlying rot remains even if Trump does secure a few bilateral deals — the kind he teases like a magician pulling pigeons from a collapsing briefcase. Supply chains are broken. Business confidence is battered. And the message to the world is loud and clear: if you were hoping for a rules-based system, you clearly haven’t been paying attention.