iM Securities: "Zero-Sum Game Risk May Materialize Depending on Tariff Negotiation Outcome"

iM Securities analyzed on July 15 that as the customs negotiation deadline approaches, if negotiations are delayed, trade among major countries could develop into a zero-sum game.

Park Sanghyun, a researcher at iM Securities, stated, "Although U.S. President Donald Trump has intensified tariff pressure on major countries by sending tariff letters and other means, there has been no news of the anticipated conclusion of tariff negotiations between the U.S. and major countries." He explained, "Given the current atmosphere, it is difficult to expect an early conclusion to the negotiations despite U.S. pressure, and it is highly likely that negotiations with major countries will continue up to the August 1 customs negotiation deadline."

He added, "The global financial and asset markets are still optimistic about a successful conclusion to the tariff negotiations," and said, "While it is clear that tariff fatigue is accumulating in the financial markets, the so-called 'everything rally' centered on risk assets is continuing."

However, Park emphasized that it is necessary to maintain at least a minimum level of caution regarding tariff risks or tariff uncertainty. He said, "It is important to keep in mind that, depending on the process or results of the customs negotiations in July, the risk of a zero-sum game among major countries could materialize," and analyzed, "From August, there is a possibility that the differentiation between the stock and foreign exchange markets of countries that have concluded customs negotiations and those that have not will become more pronounced."

He stressed, "If customs negotiations with major countries such as South Korea, Japan, the EU, Taiwan, India, and ASEAN countries are not fully concluded by August 1, the global financial market environment in August could be different from the recent atmosphere." He continued, "At the same time, the differentiation in stock prices and currency values between countries that have reached an agreement and those that have not could become more pronounced, and the United States could once again be exposed to concerns related to tariffs."