The new tariff policy of US President Trump has officially come into effect, which has had a profound impact on the global trade landscape. From sportswear to luxury cars, to chemical manufacturers, various industries are feeling the pressure brought by tariffs. The outlook for the company is bleak, with a significant drop in stock prices, and the market is full of concerns about the economic recession that may be triggered by Trump's trade war.

The shock wave of tariff policy

Trump announced on Wednesday the imposition of tariffs on all imported steel and aluminum products, which quickly triggered retaliatory tariffs from Europe and Canada. Since Trump took office, his erratic trade policies have led to chaos in multiple industries such as automobiles and energy. Enterprises and investors are uneasy about rising costs, inflationary pressures, and low consumer confidence, leading to a sharp decline in the stock market.

At a grain conference in California, agricultural executives and traders complained about Trump's tariff policies. They stated that policy uncertainty has made the past six weeks appear unusually long. Stephen Dover, Chief Market Strategist at Franklin Templeton, an asset management company, pointed out that almost all industries are struggling to cope with the uncertainty brought about by policy changes.

Industry dilemma: from automobiles to consumer goods

Automobile manufacturers are one of the industries most severely affected by tariff policies. Faced with the potential 25% tariff on imported products from Canada, Mexico, and Europe, car manufacturers find it difficult to develop long-term plans. Porsche stated that it is evaluating how to pass on tariff costs to consumers while avoiding pressure on profit margins, which means consumers may face price increases.

South Korean steel manufacturers are also considering countermeasures, including the possibility of investing and operating in the United States. Morgan Stanley Chief Economist Bruce Kasman warns that if Trump's tariff threat is implemented, the likelihood of a US economic recession will rise to 50%. He also pointed out that policy uncertainty may long-term damage the reputation of the United States as an investment destination.

The financial reports of German sportswear manufacturers Puma and Zara's parent company Inditex show that trade uncertainty has begun to suppress US consumption. Puma announced layoffs, causing a significant drop in its stock price. According to LSEG data, since the beginning of this year, over 900 large American companies have raised the issue of tariffs during their earnings conference calls, highlighting the widespread impact of tariffs on businesses.

The confidence of enterprises has been dampened, and the economic outlook is bleak

Christian Kohlsaintner, CEO of Brenntag, a German chemical distributor, stated that the current economic and political situation is making it difficult for businesses to operate. Investment company St Justin Onuekwusi, Chief Investment Officer of James' Place, pointed out that the biggest risk is for businesses to stop investing and consumers to stop buying, which will further exacerbate the risk of economic recession.

summarize

Trump's new tariff policy not only exacerbates global trade tensions, but also has profound impacts on the US and global economy. From automobile manufacturers to the consumer goods industry, companies generally face challenges such as rising costs, policy uncertainty, and low consumer confidence. With the continuous fermentation of tariff policies, market concerns about economic recession are increasing. Gold, as a traditional safe haven asset, is often favored by investors when uncertainty increases. As the trade war escalates, investors may shift their funds from high-risk assets such as stocks to gold, thereby driving up the price of gold. In the future, businesses and investors will closely monitor policy developments to cope with the long-term impact of this tariff storm.

In the short term, gold prices may fluctuate due to market sentiment fluctuations. However, in the long run, if the trade war continues to escalate and leads to increased global economic uncertainty, gold prices are expected to maintain an upward trend. Especially if the Federal Reserve turns to interest rate cuts due to economic pressure, gold will be more attractive.