On April 2, 2025, President Donald Trump declared a 10% tariff on all import duties that came into effect on April 5, and plans to commence additional country-specific tariffs on April 9.
The announcement sent shockwaves throughout the world economy, causing the worst two-day losses in the history of the US stock market. On Thursday and Friday alone, the $6.6 trillion worth of value was wiped out before the market closed over the weekend.
Shares fell again on Wednesday after a slight recovery on Tuesday. President Trump’s new tariffs on imports from dozens of countries, including a massive 104% tariff on goods from China, have come into effect, dramatically escalating the horrors of the world trade war.
How many customs do countries have?
The White House has released a list of 57 countries, territories and trading blocks that are subject to increased tariffs, as detailed in the table below. In addition to these 57, Trump also imposed a 10% tariff on imports from almost all other US trading partners.
Tariffs are government-imposed taxes on imported goods and services and are paid by businesses that bring them into the country. Tariffs are intended to protect local industries, but often make foreign products more expensive for consumers.
How much money was lost?
Three-day market losses, according to Bloomberg – Thursday, Friday and Monday wiped out around $10 trillion in global stock value. This is about 10% of the world’s gross domestic product, totaling GDP from 150 countries.
The S&P 500 has suffered the biggest loss in four days since creating a benchmark in the 1950s, with the stock market index tracking the performance of 500 people from the largest publicly traded companies in the United States.
Investors use it to assess the health of the stock market and the broader US economy.
We are currently approaching the bear market. This is 20% below the latest high.
Market closures on April 8th:
The S&P 500 closed 79.48 points (1.6%) at 4,982.77, while the Dow closed 320.01 points (0.8%) at 37,645.59.
What happened to gold, oil and Bitcoin?
Apart from the stock market, the prices of gold, crude oil and Bitcoin fell apart last week amid growing uncertainty.
Gold, which is usually considered a safe asset during periods of uncertainty, has seen an increase in demand over the past few months.
The gold market initially surged after the tariff announcement, reaching $3,167 per ounce. However, it fell 2% to $2,977 on April 7, and slightly extended to $2,984 on Tuesday.
Oil prices fell 7% in response to tariff announcements, and fell another 2% on April 5th. By Tuesday, oil had stabilized around $60 per barrel, but then fell below $57, the lowest since 2021.
Oil prices usually fall during recessions due to reduced demand, and the fear of a recession caused by a trade dispute with China, the world’s two largest economies, is contributing to this decline.
Bitcoin, which was expected to flourish under the new government, has also skated over the past week. Cryptocurrency has dropped 30% from $109,000 to today’s $77,000 since Trump took office on January 20th.
What about global currencies?
The country, which is its major trading partner with the US, responds with mixed signals, along with other emerging market currencies.
The US dollar has weakened against major currencies, including the yen and euro, while the Chinese yuan hit its 19-month low on Tuesday, becoming caught up in the crossfire of the trade tariff war.
Euro: European currency rose 0.1% at $1.09, as it fell from an increase of over 0.7% after a decline in the previous two days.
British Pound Sterling: Last week we lost about 1%, from $1 for $1 to £1.30 on April 2nd to £1.28 on April 8th.
Russian rubles: On April 2nd, I was slightly soaked from 84.2 rubles to USD, and on April 8th it reached 86.1.
China Yuan: The People’s Bank of China has weakened at a 19-month low against the US dollar, with the People’s Bank of China setting it at 7.2038 yuan per dollar.
Indian Rupee: It is expected to fall further, with South Asian powerhouse, the biggest slip in three months, fell 0.7% on Monday. The currency was closed at Rs 86.44 against the dollar, a small loss from the previous day.
Japanese Yen: Strengthened as investors evacuated from volatility and closed from 146.41 on April 2nd.
Brazilian Real: Market closed on Tuesday, dropping from 5.67 Reais to Dollar To the Dollar to 6.00.
Mexican Peso: The largest US trading partners also fell, with the peso closed at 20.89 from 20.34 on April 2nd.
South African Rand: It has weakened by 4.4% in the past week, reaching the weakest level of R19.75 in two years.
What does this mean for a global recession?
A recession is a period of significant economic decline, generally defined as two quarters (six months) negative growth in a country’s GDP.
Since 1950, the United States has experienced 11 recessions. Most notable include the Oil Crisis (1973-1975), Double Dip Recession (1980-1982), Dot-Com Bubble (2001), Global Financial Crisis (2007-2009), and Covid-19 (2020).
JPMorgan analysts estimate that there is a 60% chance of a recession, with Goldman Sachs and Morningstar having odds of 40-50%.
