Uncertainty Looms: Wall Street Slides Amid Trump's New Tariff Chaos

Wall Street and the dollar dropped due to confusion over U.S. trade policy after President Trump implemented a new 15% tariff. Gold and safe-haven currencies benefited, while European and Asian markets reacted variably. The average tariff rate is expected to stand at 13.7%, down from 16%.

Wall Street futures and the dollar experienced declines on Monday, fueled by uncertainty surrounding U.S. trade policy. The market's response followed President Donald Trump's imposition of a new 15% tariff after the Supreme Court ruled against his broad approach to trade levies.

Investors flocked to gold and safe-haven currencies, like the Japanese yen and Swiss franc, as European stock futures also saw a decline. Meanwhile, Asian markets, particularly in Hong Kong, were buoyed by optimistic expectations that U.S. tariffs on China might decrease. This market volatility reflects the current challenges in global trade dynamics.

Amidst the uncertainty, analysts highlight the potential for a 'circular process' wherein new tariffs could be announced, challenged, and then readjusted. This ongoing ambiguity complicates economic forecasting. The Yale Budget Lab predicts an average effective tariff rate of 13.7% going forward, reflecting a marginal decrease from previous highs.

(With inputs from agencies.)