Wall Street Stumbles, Gold Glitters, Dollar Holds Firm as Tariff Tensions Escalate

Markets wobble as trade war fears resurface—classic 2025 déjà vu.

Wall Street's losing streak hits day three while gold bugs cheer the safe-haven rally. Meanwhile, the dollar flexes its reserve currency muscles—because when in doubt, the world still buys greenbacks.

Tariff tantrums strike again: Investors face whiplash as geopolitical risks override Fed pivot hopes. Gold's surge exposes the market's fragile nerves, while Treasury yields dip—nobody's buying the 'soft landing' fairy tale anymore.

Bonus cynicism: Another day, another 'unexpected' market shock—if only someone had warned about protectionism's consequences. Oh wait, every economist since 2018 did.

Treasuries attract safety demand as Trump puts pressure on Powell

Investors shifted into safer U.S. government bonds, keeping the 10-year Treasury yield around 4.41%. Short-rate futures ticked up, suggesting investors expect only a handful of rate reductions over the coming year.

Even as Fed Chair Jerome Powell maintains a cautious stance on cuts, the president has intensified demands for more rapid monetary easing.

White House economic adviser Kevin Hassett hinted that the president could consider replacing Powell amid budget overruns on the Fed’s building overhaul. On Sunday, the president said it “would be a great thing” should Powell elect to step aside.

Attention now shifts to Tuesday’s June consumer price report, which may provide the first glimpse of any inflationary push from the tariffs.

Many retailers are still selling stock they bought before the tariffs, and some companies are covering the extra costs themselves to keep sales steady. Later this week, producer and import price reports will show how much supply-chain costs are rising, and new retail-sales data will reveal whether consumers are still spending.

Dollar remains steady while commodities remained mixed

In currency markets, the euro eased 0.1% to $1.1685, retreating from highs NEAR $1.1830 reached last week.

The U.S. dollar fell 0.2% versus the yen to 147.15, with its trade-weighted gauge unchanged at 97.882. It did edge up 0.2% against the Mexican peso to roughly 18.6710, as President Claudia Sheinbaum remained optimistic that an agreement could be finalized ahead of the early-August cutoff.

Gold saw a modest haven lift, inching 0.1% higher to about $3,359 an ounce, while oil gained support amid talk of possible U.S. sanctions on Russian shipments. Brent futures increased 0.2% to $70.47 per barrel, and U.S. crude ticked 0.1% to $68.55.

Investors turned to gold again as a SAFE haven. Spot gold traded just under $3,370 an ounce after a 0.6% gain last week, as trading partners rushed to strike deals before the deadline. The president sent letters to leaders like Claudia Sheinbaum, Ursula von der Leyen, Canada’s and Brazil’s officials outlining possible new tariff rates.

Year-to-date, the metal is up over 25%, touching an all-time high beyond $3,500 in April. Market participants attribute the uptick to geopolitical unease and sustained purchases by central banks.

As of 7:13 a.m. in Singapore, spot Gold had climbed 0.5% to $3,372.75 an ounce, with the Bloomberg Dollar Spot Index up 0.1%. Silver traded close to its strongest mark since 2011, while platinum and palladium experienced modest pullbacks.

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