Background on Donald Trump and His Impact on Global Markets
Donald Trump, the President of the United States, has been a significant figure in global markets due to his trade policies and decisions. His recent actions, including the threat of imposing high tariffs on European Union (EU) products and considering a 25% tariff on Apple iPhones not manufactured in the US, have caused volatility in various markets.
Trump’s Tariff Threat and Subsequent Reversal
On the weekend, Trump threatened to impose a 50% tariff on EU products starting June 1st. This threat increased demand for safe-haven assets like gold. However, Trump later reversed his decision, postponing the higher tariffs until July 9th to allow for negotiations between Washington and the EU. This reversal led to a decrease in gold prices as the demand for safe-haven assets diminished.
Market Closures and Gold Price Fluctuations
On this Monday, markets in the United States and the United Kingdom remain closed for holidays. At 4:36 a.m. CDMX time, spot gold prices fell by 0.8% to $3,329.78 per ounce, while US gold futures dropped by 1.1% to $3,329.20 per ounce.
Expert Analysis and Market Reactions
Giovanni Staunovo, an analyst at UBS, described the day as “a negotiation day within range,” attributing the decline in gold prices to Trump’s decision to postpone higher tariffs on the EU. He also noted that market activity would likely remain low due to the Memorial Day holiday in the United States.
Impact on Other Precious Metals
The price of silver fell by 0.5% to $33.31 per ounce, platinum dropped by 0.8% to $1,086.20 per ounce, and palladium declined by 0.7% to $985.51 per ounce.
Key Questions and Answers
- What caused the drop in gold prices? The reversal of Donald Trump’s threat to impose high tariffs on EU products led to a decrease in demand for safe-haven assets like gold.
- Why are US and UK markets closed today? These markets are closed for holidays.
- How did other precious metals perform? Silver fell by 0.5%, platinum dropped by 0.8%, and palladium declined by 0.7%.
