By Nermeen Nabil Khear The tension between the two leading global economies continues in full force as the White House threatens Beijing with another set of tariffs that could increase the total to 245%.
Financial markets reacted with immediate volatility. Stock futures went down, gold jumped yet again, while bitcoin remained relatively stable.
New Tariffs on the Horizon?
Ever since Trump took office in mid-January, his global policy has been quite controversial in terms of slapping tariffs on other nations, even those that were previously considered partners. After the first wave that saw the names of Canada, Mexico, and China, the EU was inserted into the mix as well, and then essentially every single country.
His ideology became clearer when he paused the tariffs against every other nation except for China last week. Numerous experts commented that his overall target was the Asian giant, and he used the other tariffs to bully the rest. History shows a lot of trade war tension between the White House and Beijing when Trump was running the former.
In the latest development during this never-ending saga, the US threatened China with increasing the tariff percentage from the current 145% to 245% if the latter continues to retaliate. The timeline for this is quite peculiar, as the warning came just after Trump approved an investigation into “national security risks posed by the US’ reliance on imported, processed critical minerals and derived products.”
Some of those include lithium, nickel, cobalt, military equipment, and rare-earth metals used to produce batteries and smartphones.
Although the Chinese government published better-than-expected economic growth results for Q1, it said this trade war will harm not only domestic production but also the global economy. Sheng Laiyun, the Deputy Commissioner of the China Statistics Bureau, said Trump’s “trade bullying” violates laws and the principles of the World Trade Organization (WTO) and has a “serious impact on the global economic order.”
Markets React
The rising tension between the two biggest economies led to an immediate impact on financial markets, as it has happened during the past few months. Gold, which is the biggest beneficiary of Trump’s policy, continues its ascent as its price against the dollar skyrocketed to a new all-time high of over $3,300/oz. The bullion is enjoying one of its best years as its price has risen by 25% YTD.
In contrast, US stock futures tumbled immediately after the news went out. The Dow dropped by 1%, the S&P 500 by 1.4%, while tech stocks (read The Nasdaq Composite) plunged by 2.2%.
Interestingly, BTC’s price wasn’t really influenced by the aforementioned developments. Or, it might have been priced in ahead of time. The asset retraced from $86,500 to $83,000, but that was before the warnings were announced. Since they went live, bitcoin has maintained a steady level and is even close to $84,000 now.
The post US-China Trade Tensions Escalate: Bitcoin, Stocks, Gold React to 245% Tariff Threat appeared first on CryptoPotato.
Gold continues to chart new all-time highs. AA News, BTCEUR, BTCGBP, BTCUSD, BTCUSDT, Crypto News, China, United States
This articles is written by : Nermeen Nabil Khear Abdelmalak
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