How does the cancellation of Trump tariffs affect the markets?

The cancellation of tariffs generally
- reduces economic uncertainty by removing trade barriers,
- eases inflation pressures,
- encourages global growth.
This situation can increase risk appetite, positively impacting risky assets like stocks, while putting pressure on safe-haven assets such as gold and silver.
I will provide a theoretical analysis based on recent examples.
The analysis is inspired by developments related to Trump’s tariffs in recent years, such as the Supreme Court’s cancellation decisions or suspensions(.
#Gold
The cancellation of tariffs can lead to a decrease in gold prices because it reduces geopolitical and economic risks. Gold tends to rise as a safe haven during periods of uncertainty, but investors shift toward risky assets when positive developments like cancellations occur. For example, when Trump’s comprehensive tariffs were canceled by the Supreme Court, gold prices initially declined in the short term but later recovered. Similarly, suspending tariffs can lower gold prices by 2-5%, as inflation expectations decrease. In the long term, if cancellations boost global demand and strengthen the dollar, gold could come under pressure.
#Silver
Silver is affected both as a safe haven and an industrial metal. The cancellation of tariffs can boost industrial demand expectations, such as for electronics and solar panels), but reduce safe-haven demand. Recently, after Trump suspended or canceled European tariffs, silver prices declined by around 5-9, moving away from record levels. Overall, while cancellations are positive, volatility may remain high; short-term declines and medium-term industrial recovery are expected.
#Cryptocurrency Markets
Crypto assets()like Ethereum( benefit positively from tariff cancellations as risky investments. When uncertainty decreases, investors turn to crypto, liquidity increases, and prices rise. In cases where Trump canceled or delayed tariffs, crypto markets grew by 0.7-2%, with Bitcoin’s volatility decreasing and an overall upward trend. However, factors like crypto regulations or dollar strength can be limiting; cancellations may trigger a bull market in the short term.
#US Stock Markets
The cancellation of tariffs can boost US stock markets#Bitcoin, #)like Nasdaq( by increasing corporate profits. Since trade wars raise costs, cancellations reduce inflation and support growth. Recent examples show that when Trump’s tariffs were canceled or suspended, the S&P 500 increased by 0.4-3.3%, led by technology stocks. In the long term, if cancellations revitalize global trade, markets could rally by 5-10%, but other factors like Fed policies are decisive.
#Istanbul Stock Exchange (Borsa İstanbul)
Borsa Istanbul#SPX500, ##BIST100) benefits indirectly from tariff cancellations because it is integrated with global markets. Cancellations can increase Turkey’s exports(especially to Europe and the US), encourage foreign exchange inflows, and reduce risk premiums. When Trump suspended tariffs, BIST 100 surged by about 3.27%, participating in the global rally.
In the short term, positive effects are expected, but local inflation or geopolitical risks(for example, in the Middle East) may be limiting. Overall, cancellations could push Borsa Istanbul up by 2-5%.
In conclusion, tariff cancellations improve overall market sentiment, but the duration and magnitude of their impact depend on factors like Fed interest rates, geopolitical developments, or China.
Additionally, Trump’s attempts to implement new tariffs increase uncertainty, potentially leading to a negative outlook again.
This analysis is general in nature and may vary depending on market conditions.