Stock markets in Asia extended Wall Street’s overnight rout, with investors spooked by the spectre of a global trade war after President Donald Trump said the United States would impose hefty tariffs on imported steel and aluminium. Asian steelmakers fear U.S. tariffs could result in their domestic markets becoming flooded with steel products that have nowhere else to go.

Markets are already fretting about the tempo of U.S. rate hikes this year, and now added to that is the fear escalating trade protectionism could dent global growth and corporate earnings – key drivers of last year’s rally in equities.

U.S. Treasury yields fell as the risk of a trade war appeared to push aside considerations of inflation, a major theme that spooked global financial markets earlier this year.

In the currency market, the dollar’s rebound following the bullish comments on the U.S. economy from new Federal Reserve Chair Jerome Powell lost momentum. The euro jumped back to 1.2271, after having hit a seven-week low of 1. 21545.The yen got an additional boost when Bank of Japan Governor Haruhiko Kuroda said he would mull an exit from the BOJ’s current stimulus regime if the central bank’s 2 percent inflation target is achieved in 2019.

Oil prices were also under pressure, having fallen more than 1 percent the previous day on trade friction fears. U.S. crude was little changed in late Asian trade at $60.93 per barrel, having fallen to two-week low of 60.18. Brent futures traded at 63.85 per barrel after having hit a two-week low of 63.19.

Gold prices rebounded, bouncing off a two-month low as news of U.S. tariffs on steel and aluminium imports spooked investors, encouraging them to flock toward safer assets. Comex gold futures were up 1% at 1,318.3 a troy ounce off two-month trough of 1,303.60.

The economic calendar comes with major economic events with high impact which should provide moderate to high volatility mainly in the European and American sessions. Moderate to high volatility is expected for the release of economic data such UK Construction PMI Prime Minister May Speech, BOE Gov Carney Speech, Canada GDP Growth Rate and US Revised UoM Consumer Sentiment.