Pakistan's bonds slip after Trump announces new US tariffs

Pakistan's international sovereign bonds came under pressure on Friday after US President Donald Trump announced fresh tariffs on imports from 60 trading partners, triggering a broader sell-off across emerging market debt.

According to reports, Pakistan's 2036 sovereign bond fell 0.5% to a bid price of 97.80 cents on the dollar. 

Indonesia's 2045 bond also declined by 0.5% to 88.48 cents, while Sri Lanka's 2033 bond lost just over one cent to trade at 93.05 cents on the dollar.

The White House announced tariffs of 10% and 12.5% on goods imported from 60 countries, citing inadequate enforcement of bans on forced labour. The measures were unveiled as a temporary 10% global tariff was set to expire.

Countries subject to the new 10% tariff include Pakistan, Argentina, Bangladesh, Britain, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Sri Lanka, and Trinidad and Tobago.

The European Union, Taiwan, Japan, South Korea and Switzerland were assigned tariff rates that, when combined with existing most-favoured-nation duties, would amount to either 10% or 12.5%.

The tariffs were announced through a Federal Register notice on Thursday and apply to goods accounting for 99.4% of US imports. However, the measures exempt several products, including oil and gas, fertiliser, and certain food items.

The latest tariff package marks the White House's renewed effort to implement President Donald Trump's campaign pledge of imposing broad-based tariffs. The move follows a February ruling by the US Supreme Court, which struck down the administration's earlier "reciprocal" tariffs ranging from 10% to 50% that had been introduced last year under emergency powers to reduce the US trade deficit.

Sri Lanka is expected to be particularly affected, as the United States is its largest export market, importing around $3 billion worth of goods annually, primarily apparel.