SINGAPORE, (Reuters) – Commodities including oil, copper and agricultural products dropped yesterday as U.S. President Donald Trump’s aggressive tariffs on key trading partners fuelled fears of recession, while safe-heaven gold jumped to an all-time high.
Trump announced a 10% minimum tariff on most U.S. imports, with significantly higher duties on goods from dozens of countries including China, which is likely to prompt countermeasures potentially driving up prices and reducing demand for U.S. goods.
“The higher than expected reciprocal tariffs have predictably raised worries of a U.S. recession and slower global growth,” Vivek Dhar, a commodities strategist at Commonwealth Bank of Australia said in a note.
“Copper and oil futures, which typically track the global growth narrative, have declined this morning. Oil demand growth is particularly leveraged to emerging economies, especially in Asia, where some of the reciprocal tariffs are high.”
Stock markets plunged, with the high-flying tech sector taking a hit, as new tariffs pushed the total levy on most Chinese imports to 54%. MKTS/GLOB
Retaliatory tariffs by China, the world’s biggest importer of agricultural goods, could further dent demand for U.S. products such as soybeans, which have already declined since the trade war during Trump’s first term in 2018.