New Delhi, April 7 -- US President Donald Trump's decision to levy reciprocal tariffs on trading partners has opened a can of worms for emerging market (EM) equities. A 10% baseline tariff is levied on all countries effective 5 April, while countries with whom the US has large trade deficits are subject to higher reciprocal tariff rates effective 9 April. With that, EM economies are now exposed to external risks such as subdued export demand and currency volatility weighing on their economic growth prospects.

"For Asia, we believe growth overall could fall to 4% or lower in 2025, down from around 5.1% last year, with the trade-driven economies of North Asia, Thailand, Malaysia, and Singapore most susceptible to a slowdown," UBS said in a...