The U.S. will impose a 25% tariff on certain advanced AI chips from January 2026 to boost domestic manufacturing, impacting the global semiconductor supply chain and prompting strategic adjustments in Thailand’s electronics sector.

U.S. Imposes 25% Tariff on Advanced AI Chips

The United States will enforce a 25% import tariff on certain advanced AI chips, effective January 15, 2026, under Section 232. This applies globally, including imports from Thailand. The tariff targets high-performance processors such as Nvidia’s H200 and AMD’s MI325X, aiming to strengthen domestic chip manufacturing and reduce reliance on foreign suppliers. Some exemptions apply, including chips used in U.S. data centers, research, and startups, which will face a 0% tariff initially.

Global and Thailand’s Semiconductor Industry Impact

The tariff increase is expected to disrupt the global semiconductor supply chain, raising production costs and encouraging investment to return to the U.S. This could cause ripple effects in Thailand, particularly in electronic exports and component supply chains to economies like China and Taiwan. Although Thailand’s direct exports of advanced chips to the U.S. remain limited, indirect impacts and investment volatility in the region may occur.

Strategic Response for Thai Electronics Operators

Thai electronics businesses must quickly adjust strategies to mitigate risks from the tariff changes. Diversifying markets towards ASEAN, Japan, and Taiwan and enhancing competitiveness are key. Long-term efforts should focus on workforce skills development and boosting R&D to increase upstream chip production capabilities. Collaborative public and private sector initiatives are crucial to sustaining Thailand’s role in the global supply chain amid ongoing technological competition.

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Japanese stocks jumped to record peaks while ‍bonds slid and the yen sagged to an all-time low against the Swiss franc after Prime ⁠Minister Sanae Takaichi scored a landslide win in Sunday’s snap election.

Takaichi’s Liberal Democratic Party won 316 of the 465 seats in parliament’s lower house, giving her the mandate to push through her big ‌spending plans and ‌promised tax relief without negotiating with other parties. The so-called supermajority also allows the LDP to pass legislation without ‌upper house approval.

The Nikkei 225 share average rallied as much as 5.7% to an unprecedented 57,337.07 by 0030 GMT.

The broader Topix jumped 3.4% to a record 3,825.67.

Ten-year Japanese government bond yields rose as much as 4.5 basis points (bps) to 2.275%, and 30-year JGB yields climbed as much as 6.5 bps to 3.615%. Other tenors are yet to trade. Bond yields rise when prices fall.

“The size of ‌majority gives clarity ‍for Japan on the direction ahead: short term, markets adjust and ‍are assuming weaker yen and potentially higher yields across the ‌curve,” said George Boubouras, head of research at K2 Asset Management.
“But once policies are lined up with the new massive majority, the yen should hold up again.”From a policymaking perspective, Takaichi’s big win may be the best result for bond investors, because the LDP won’t need to compromise with opposition parties targeting even deeper tax relief and broader fiscal stimulus.

The 30-year JGB yield surged to a ‍record 3.88% last month when Takaichi initially pledged to suspend the tax on food for two years, but has been well below that ‍for the past ⁠two weeks.

The yen eased ⁠as much as 0.3% to reach 203.30 per franc for the first time ever on Monday.

Japan’s currency declined 0.4% to 186.55 per euro, putting it close to the record low of 186.86 from last month. It fell 0.5% to as low as 157.95 per U.S. dollar, a two-week trough.

For now, however, Japan’s top currency diplomat Atsushi Mimura appears to have put a floor under the yen, saying the government is “closely watching currency movements with a high sense of urgency” in a warning about potential yen-buying intervention.

Mumbai: Domestic institutions’ ownership in Indian firms rose to a new all-time high of 18.72% in the December quarter, further stretching their lead over foreign investors after overtaking them for the first time in January-March 2025.

The stake of overseas investors in Indian firms, meanwhile, declined to 16.6% – the lowest in 14 years, according to a study based on Prime Database data.

The “sticky inflow” through systematic investment plans and from wealthy individuals and retail investors, along with pension funds increasing exposure to equities, tilted the ownership structure to local institutions, said Rupen Rajguru, head of Equity Investment and Strategy at Julius Baer India.

Steady SIP Flows
Mutual fund (MF) holding increased to 11.1%, the highest on record, in the October-December period, the tenth consecutive quarter when it rose.

The gap between MF and foreign institutional investor (FII) holdings shrank to 5.5 percentage points (550 basis points) from 10.5 percentage points as of December 2022. “The balance of ownership in Indian equities is gradually tilting inward as MFs alone seem set to overtake FIIs,” said Prime Database managing director Pranav Haldea.
Mutual funds poured in Rs 1.06 lakh crore in the December quarter on a net basis, while global investors liquidated Rs 11,765 crore combined in the primary and secondary markets.
While flows from MFs have been the highest among domestic institutions, insurance companies with a net buying of Rs 21,490 crore, alternative investment funds (Rs 367 crore) and portfolio management services (Rs 1,205 crore) also played their part, said Haldea.
Despite zero returns in the last 16 months, SIP flows from mutual funds remained steady and strong, Rajguru said.

Foreign investors sold stocks worth over Rs 42,000 crore between October and December in 2025, after dumping Rs 1.02 lakh crore between July and September.

Analysts said uncertainty of the US-India trade deal, which also weakened the rupee, had soured foreign investor sentiment on India.