The Trump 2025 tariff impact began in April, when President Trump announced blanket tariffs on all global imports—shaking not just trade relations but the entire flow of global capital.
This wasn’t merely a trade issue. The impact rippled across the markets—hitting currencies, gold, oil, and more. The dollar weakened, gold soared, oil prices swung violently, and each major asset class reacted strongly.
What stood out, though, was how differently they reacted.
It was like a scene from a disaster movie: one person runs clutching their cat, another opens the safe, while someone else just stands still mid-snack with a dazed look.
In this post, I’ll walk you through how Trump’s tariff policy affected the foreign exchange market, gold, and oil—each in its own unique way.
🇰🇷 This article is also available in [Korean version]
1. The Dollar: Slipping After the Tariff Shock
1-1. Initial Strength
At first, the dollar surged.
Following Trump’s reelection, investors bet on U.S. economic recovery and interest rate hikes, preferring dollar-denominated assets.
The Dollar Index (DXY) climbed to a four-month high of 104.2, gaining against the euro and the Mexican peso.
Despite policy uncertainties and potential rate volatility, the prevailing view was still: “The dollar is safe.”
1-2. Tariff Announcement Turns the Tide
But the moment the tariffs were announced, everything changed.
The dollar slipped, and investors rushed to other safe-haven currencies like the yen and euro.
- Dollar Index fell from 104.2 → 103.2
- Yen surged: $1 = ¥150.3 → ¥146.4
- Euro strengthened against the dollar
- Yuan hit a 19-month low
The message was clear: the U.S. had become the source of instability, and the dollar’s role as a safe haven was under threat.
Capital quickly flowed into non-dollar assets like the yen and euro, pushing the dollar further down.
The lesson? Even the dollar isn’t immune. Political risk can erode trust, even in the world’s most dominant currency.
2. Gold: The Ultimate Safe-Haven and Last Refuge
This is where gold takes center stage.
When stocks are unreliable, the dollar looks shaky, and even bonds are losing ground, investors turn to gold as their final line of defense.
When stocks plunged for two straight days, gold shot up more than 3% in just one day.
With inflation risk rising and policy uncertainty mounting, gold became the ultimate refuge.
- In early January 2025, spot gold hit $2,670/oz—its highest in years
- After April’s tariff shock, gold futures breached $2,700 in a single day
- Up over 15% in just 100 days
- Surge in gold ETF inflows
- Gold mining stocks climbed
- Institutional investors started reallocating large portions of portfolios into gold and mining assets
Gold gets stronger in times of fear—and in this case, it reigned supreme.
Though prices were volatile due to constant news, gold became the go-to hedge against “Trump risk.”
Even the bond market was shaky, making gold one of the few truly trusted assets.
In today’s era of mounting policy risk, gold is no longer just a crisis hedge. It now functions as a political risk shield, even a strategic structural alternative to traditional holdings.
This shift highlights the Trump 2025 tariff impact on how investors redefine safe-haven assets.
3. Oil: A Sentiment-Driven Rollercoaster
Oil is often called the “pulse” of the real economy.
When oil becomes erratic, it’s a warning light that the broader economy may be heading into turbulence.
3-1. Early Rise: Optimism on Energy Policy
At first, oil prices rose.
Trump’s pledges to deregulate the energy sector and expand shale development boosted expectations.
Combined with hopes for global economic growth, WTI crude nearly breached $80/barrel.
Oil moved in tandem with stock prices—
- Soaring one day, crashing the next, rebounding, then sliding again
Why? Because investors couldn’t decide: “Is the economy recovering, or about to slow down?”
Oil was tossed around by sentiment swings.
But this didn’t last long.
3-2. Post-Tariff Turmoil: Growth vs Recession Fears
After the tariff shock in April, sentiment shifted hard:
“Oh no, this could kill the recovery.”
Oil tanked along with stocks.
Tariffs triggered fears of a global slowdown, which translated into expectations of weaker oil demand.
- By March, S&P 500–oil correlation: 0.9 (near perfect)
- WTI crude dropped more than $10/barrel in a single day post-announcement
- A rebound came after the April 9 partial tariff delay, but high tariffs on China stayed, and oil soon fell again
- April 9: rebound → followed by renewed decline
By the end of the first 100 days, oil had either stagnated or declined slightly.
Many institutions reduced oil exposure and pivoted toward gold as their primary hedge.
Oil is the thermometer of the global economy.
Its instability signaled that investors had lost confidence in where the world economy was heading.
That a single policy from Trump could shake fundamental economic forecasts was a serious red flag.
4. Gold and Oil: A Clear Decoupling
Decoupling: When two assets that usually move together start going their separate ways.
4-1. Strategic Portfolio Shifts
Gold rose as an inflation hedge—a way to preserve real value even as prices rise.
Oil faltered—deeply sensitive to concerns over economic slowdown.
Trump’s tariff move sent contradictory signals across asset classes.
Some hedge funds rebalanced toward gold and bonds, steering clear of oil due to its increased volatility.
- Hedge Fund: High-return fund using complex strategies, typically for institutions or wealthy individuals
- Rebalancing: Adjusting portfolio composition to reduce risk or chase opportunity
- Risk Factor: An element that could negatively affect investment returns
4-2. Expert Outlook on Gold–Oil Trends
Experts believe that if political risks persist, the decoupling between assets like gold and oil could deepen further.
Gold, in particular, is likely to maintain its status as the last-resort defensive asset amid policy shocks.
Trump’s protectionism didn’t just shake trade statistics—it disrupted the relationships between assets.
- The dollar lost some safe-haven appeal
- The yen and euro reemerged as go-to safety currencies
- Gold surged, oil slumped
This divergence revealed how investors scrambled to avoid risk.
And it’s not just a short-term reaction.
These shifts may become key benchmarks for longer-term portfolio strategy.
As uncertainty rises, investors are now asking:
“Which assets truly withstand political shocks?”
Final Thoughts
Looking back on the impact of Trump’s first 100 days—on stocks, interest rates, currencies, gold, and oil—it’s clear that asset markets don’t move on pure logic.
They move on psychology and trust, often swayed by political decisions.
It’s fascinating: just one tariff policy triggered such varied asset reactions.
Investors didn’t wait for data—they fled uncertainty and sprinted toward safety.
The dollar wobbled, while gold gleamed.
Trump’s tariff move wasn’t just a trade headline.
It became a full-blown political risk event that disrupted global capital flows.
And Trump’s stance on tariffs? It’s still changing by the day.
Just as the world watches his every word, I believe he’s also keenly aware of being watched.
Global investors are still locked in this high-stakes psychological standoff—and all eyes remain on Trump.
The lasting Trump 2025 tariff impact will likely shape how capital moves for years to come.