- Global stocks slump, with European and Asian markets down over 1%.
- Gold hits a record high of $3,154 per ounce as investors seek safety.
- Trump’s new tariffs, including a 25% levy on foreign cars, intensify recession worries.
Global financial markets faced a sharp sell-off on Monday as investors reacted to U.S. President Donald Trump’s aggressive trade policies. Major indices in Asia and Europe fell, with Germany’s DAX dropping 1.2% and Britain’s FTSE 100 down 1%.
Meanwhile, fears of a global slowdown have driven investors toward safe-haven assets, pushing gold prices to a historic high of $3,154 per ounce. Goldman Sachs raised the probability of a U.S. recession to 35%, citing declining consumer confidence and weakened GDP forecasts.
Stock Markets Reel as Gold Soars Amid U.S. Trade War Tensions
Financial markets worldwide have been shaken as investors brace for new trade tariffs set to take effect on Wednesday. European stocks opened sharply lower, with the Stoxx 600 index falling 1.3% and automakers seeing some of the biggest losses. The potential impact of a 25% tariff on foreign-made cars has already sent shockwaves through the industry, with manufacturers warning of higher prices and supply chain disruptions.
In Asia, benchmarks in Tokyo and Taiwan dropped over 4%, marking one of the worst trading sessions in months. Meanwhile, Thailand’s SET fell 1.3%, also impacted by a major earthquake in Myanmar that caused destruction in the region. Investors have turned to gold as a hedge against economic uncertainty, leading to its record-breaking surge.
The sell-off is driven by fears that Trump’s tariffs could tip the U.S. economy into recession. Goldman Sachs revised its U.S. GDP forecast for Q1 down to just 0.2%, citing the rapid decline in business and consumer confidence. The president’s insistence on broader tariffs, including secondary levies on Russian crude, has added to concerns over global economic stability.
While Trump remains firm in his stance, the market reaction suggests growing unease among investors. With key European and Asian indices in decline, and gold hitting all-time highs, the coming weeks could be crucial in determining whether these protectionist policies push the global economy toward a downturn.
The latest trade war escalation is fueling uncertainty across financial markets, driving investors toward gold and sparking fears of a global recession. If tensions continue to rise, further market turbulence could be inevitable.
“Trade wars are good, and easy to win.” — Donald Trump (2018)
