Trump's New Tariff Threats Shake Global Markets and FX Strategies

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Trump's New Tariff Threats Shake Global Markets and Forex Strategy
The forex market is bracing for volatility as President Donald Trump prepares to announce new tariffs — potentially up to 60 percent on imports from China and broad tariffs on global trading partners.

During his election campaign and presidency, Trump pushed for "reciprocal tariffs," which could range from 10 percent to 60 percent, specifically targeting imports from China, the EU and Canada. The goal is to reduce the U.S. trade deficit—but this comes with potential global economic risks.

The list of "Dirty 15" countries that could be targeted includes China, Vietnam, India, Mexico, Japan, Germany and others. These countries represent the majority of U.S. trade and are heavily involved in forex currency pairs such as:

• USD/CNH
• USD/JPY
• EUR/USD
• GBP/USD
• USD/VND

For forex traders, the upcoming tariff plans could cause:

• Increased volatility in major currency pairs
• Inflationary pressures drive demand for safe-haven assets such as gold (XAU/USD) and JPY
• Depreciation risk for emerging market currencies such as USD/MXN, USD/TRY, USD/INR

Tariffs increase the cost of imports — hurting U.S. businesses and consumers, risking slowing economic growth and higher inflation. This creates significant uncertainty for forex trading strategies. Analysts predict:

• Stock market turmoil
• Bond yields fall
• Demand for safe-haven currencies and commodities soars

• XAU/USD for gold price volatility amid escalating tariff tensions
• AUD/USD, NZD/USD and USD/CAD due to their sensitivity to global commodity trends
• The USD Index (DXY) is the leading indicator of the strength of the USD across major currency pairs
• Possible retaliatory tariffs from China, the EU and other trading partners could change forex market sentiment