Trump's "auto tariff nuclear bomb" detonates the world, gold continues to set a new record

As the Trump administration will elaborate on April 2, people are both optimistic and fearful. All signs suggest that the White House will target countries with the worst trade imbalance with the United States, which are believed to cover 15% of U.S. trading partners. Therefore, they are called "dirty 15 people", including China, the EU, Mexico and South Korea.

Negotiations with several countries are already ongoing to find a middle ground, so if Trump shows tolerance, a relief rebound may follow. However, if the announcement contains few exemptions and the market is disappointed, Wall Street shares may resume selling.

Trump is also likely to introduce further industry tariffs, such as medicines. In this case, risk preferences will be difficult to go further.

So far, concerns about the U.S. economy staggering in Trump’s radical policies proved unfounded, but next week’s non-farm jobs report could change that. The Department of Government Efficiency (DOGE) has been busy laying off federal staff since its establishment after the victory of Donald Trump.

These layoffs may begin to appear in the employment data for March. Meanwhile, many businesses have become more cautious about hiring programs, especially in manufacturing, as President Trump's capricious tariff decisions have brought a lot of uncertainty to the economic outlook.

Federal Chairman Powell insists that the U.S. labor market remains "balanced". Still, the risk is clearly skewed downward, so there is some anxiety about Friday’s employment data. After an increase of 151k in February, non-farm employment is expected to increase by 128k in March.

Forex Market:The overall trend of the US dollar index fluctuated this week, reaching a high of 104.7, but then fluctuated lower, closing around 104 on Friday. The uncertainty of Trump's tariffs and trade policies still kept traders cautious. In terms of non-US currencies, the US dollar fluctuated higher against the yen and pound against the US dollar during the week and is expected to close higher for the third consecutive week. The euro fell slightly against the dollar. The overall Australian dollar against the US dollar fluctuated.

Gold Market:Spot gold continues to soar, refreshing its historical high to 3086.75 yuan/ounce, closing higher around its historical high for the fourth consecutive week, mainly because tariff policies are still dominating market sentiment and the market's risk appetite has deteriorated again.

Crude Oil Market: International oil prices closed higher for the third consecutive week, with Trump's secondary tariffs on Venezuelan oil and a decline in U.S. crude and fuel inventories have all boosted oil prices, but Russia and Ukraine's ceasefire in the Black Sea and energy facilities limiting oil prices.

Review of the news this week

1. Trump's "auto tariff nuclear bomb" detonated the world, and traders accelerated the smuggling of copper mines into the United States

U.S. President Trump signed an executive order on March 26, 2025, announcing an additional 25% tariff on all imported cars. The measures will take effect on April 2, on the grounds of protecting national security.

Many countries around the world strongly oppose: Canadian Prime Minister Carney called this move a direct attack on Canadian workers and promised to establish a $1.4 billion strategic response fund. The U.S. Secretary of aihuaforex.commerce agreed that if Canadian vehicles account for 50% or more of the US-made parts, they will be exempt from tariffs.

Countries responded: Japan, Brazil, the EU and others have expressed that they will take countermeasures, including raising taxes and cracking down on US service exports. The EU plans to make concessions to Trump to lift some tariffs.

Copper tariff concerns: Trump will accelerate the collection of copper tariffs, implementing them within a few weeks, with a tax rate expected to be 25%. The arbitrage window prompted traders to accelerate their shipment of copper to the United States, with copper prices on Shanghai, London Metal Exchange (LME) and New York Mercantile Exchange (COMEX) all hitting record highs.

Policy-making process: The Trump administration adopts a "two-step" strategy, using the Tariff Act and the Trade Act to impose tariffs. Market confidence fluctuates and US stocks fluctuate.

2. The trilateral talks between the United States, Russia and Ukraine stated differences, and the battlefield situation was aihuaforex.complex. The outcome of the talks: The White House of the United States announced the results of the technical talks with the delegation of Russia and Ukraine, and reached a consensus on the safety of navigation in the Black Sea, including the agreement to avoid the use of force and protect energy facilities.

Differences in statements: There is a clear difference between Russia and Ukraine and the United States. Russia requires the West to lift sanctions and Ukraine retains the right to self-defense.

Battlefield Progress: Putin claimed that the Russian army controlled 99% of Lugansk and proposed to establish a temporary management agency under the supervision of the United Nations. The Ukrainian army announced the results of local counterattacks, and the Russian side said it had reached an agreement with the United States not to attack energy facilities.

US-Ukrainian Mineral Agreement: The Trump administration plans to expand the scope of resource cooperation with Ukraine and requires Ukrainian to inject natural resource project revenue into the US-Ukrainian joint investment fund.

3. The Federal Reserve's "dream of interest rate cuts shattered", with the probability of remaining still in May nearly 90%. Policy trends: The market expects that the probability of the Federal Reserve maintaining interest rates in May is as high as 87.8%, and the expectation of interest rate cuts is affected by inflation.

Inflation concerns: Many Fed chairmen have warned that the process of inflation decline is bumpy, and rising inflation expectations have become a roadblock to interest rate cuts.

Market expectation: By the June meeting, the probability of maintaining interest rates unchanged and cutting interest rates by 25 basis points will be 35.6% and 57.1% respectively, with great uncertainty in the path.

Economic indicators: The annual rate of core PCE was 2.8%, a new high; the annual rate growth rate of US GDP was revised up to 2.4%.

4. "X-day" alert! The earliest debt default in the United States at the end of May?

Debt Capaihuaforex.com: The bipartisan policy center warns that if tax revenues fall below expectations, the date on which the federal government cannot meet its payment obligations may be advanced to early June.

Institutional forecast: BNP Paribas believes that debt defaults may occur as early as the end of May, and other institutions are expected to be postponed to the end of August or the third quarter.

Congressional Budget Office: If Congress does not raise the debt ceiling, the US government may face some debt default risk by August or even at the end of May.

5. White House group chat leak incident: Signal has become the latest defense loophole in the United States?

Leakage: Jeffrey Goldberg, editor-in-chief of the Atlantic monthly magazine, was accidentally pulled into Signal's confidential group chat and learned about the US military's aihuaforex.combat plan to aihuaforex.combat the Houthi armed forces in Yemen.

Participants: Senior officials including Vice President Vance and Defense Secretary Hegseyth did not notice the reporters were present.

Response: The White House National Security Council is investigating the reasons, Trump mocked the Atlantic monthly issue, and the Democrats strongly criticized it.

6. Iranian Foreign Minister made a tough statement: The United States will not change its policy, so no talks!

Iranian Attitude: Iranian Foreign Minister Aragzi reiterated that he would not negotiate directly with the United States under extreme pressure and military threats, but allowed to continue to aihuaforex.communicate through indirect channels.

U.S. pressure: U.S. envoy to the Middle East is Vetkov, who said Trump's proposal to talks aims to avoid military action, but Iran's supreme leader Khamenei refused.

7. Greenland criticized the US delegation for "uninvited" and Trump insisted that he was "invited to visit"

Diplomatic dispute: The wife of the US Vice President announced that she would lead a delegation to visit Greenland, and the Prime Minister of the Greenland Autonomous Government emphasized that no invitation was issued.

Trump responded: Trump insisted that the visit was invited, suggesting that Greenland could become a part of the future of the United States.

Denmark's reaction: The Danish Prime Minister strongly condemned the US plan and believed it was unacceptable pressure on Greenland.

8. UK Spring Budget Statement: Economic expectations are lowered, inflation expectations are raised

Economic expectations: The UK government lowered its economic growth forecast for 2025 to 1.0%, far lower than previous forecasts.

Inflation expectations: The Consumer Price Index (CPI) forecast for 2025 is 3.2%, higher than previous forecasts.

Welfare reform: The government plans to cut welfare spending to save £4.8 billion.

Defense Budget: Increase the budget of 2.2 billion pounds and invest 500 million pounds to reform the defense procurement system.

Trade Warning: Intensified global trade disputes could lead to a drop in UK GDP by up to 1%.

The above content is all about "[Ihua Foreign Exchange Official Website]: Trump's "auto tariff nuclear bomb" detonates the world, and gold continues to set new historical highs". It is carefully aihuaforex.compiled and edited by the Avatrade Foreign Exchange editor. I hope it will be helpful to your transactions! Thanks for the support!

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