On March 5, 2025, Asian stock markets largely declined amid worries surrounding U.S. President Donald Trump’s erratic trade policies. Investors are particularly apprehensive that his tariffs could lead to a recession in the U.S. The most recent action involved a 25% tax on all aluminum and steel imports to the U.S., which will impact countries such as Brazil, South Korea, and the European Union.

Trump's fluctuating tariff announcements have heightened market volatility, driving the VIX "fear index" to its highest point since August. While the president played down recession concerns, asserting the U.S. economy would "boom," analysts pointed out the increasing uncertainty in policy and its adverse effects on consumer and business confidence.

With the U.S. confronting greater unpredictability, other regions are becoming more appealing to investors seeking stability, as anxieties grow over U.S. stock valuations and economic projections.