Markets fled to safety Thursday as Trump escalated tariffs on China to 125%, triggering a surge in gold, yen, and bonds. Despite a brief equity rally, investor confidence in U.S. trade policy and the dollar continues to erode.
Financial markets witnessed a swift flight to safety on Thursday after U.S. President Donald Trump intensified his trade war with China, sharply raising tariffs while simultaneously suspending levies on other nations for 90 days. Investors flocked to safe-haven assets such as the Japanese yen, Swiss franc, and gold, while U.S. Treasury bonds rallied, putting the dollar under broad pressure.
Despite Asian equities surging on hopes of eased trade tensions, Trump’s move to single out China with a staggering 125% tariff rate—up from 10%—sparked fresh market anxiety. The Chinese yuan briefly fell to its lowest level since 2007 before slightly recovering. Meanwhile, the Aussie and Kiwi dollars, initially hit due to close trade ties with China, regained momentum as the risk rally spread to Europe.
Analysts noted a growing crisis of confidence in U.S. trade leadership, citing the administration’s erratic policy shifts. ANZ analysts highlighted concerns over the long-term credibility of the U.S. dollar, while others warned of lasting economic damage.
With markets on edge, investors remain cautious, questioning whether temporary policy reversals can offset the uncertainty wrought by Trump’s aggressive trade manoeuvres.
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Maritime trackers received new reports of an attack on a ship in the Strait of Hormuz on Sunday, according to the UK Maritime Trade Operations (UKMTO), adding to concerns about energy supplies after Saudi Arabia shut down a vital oil pipeline on Saturday.
A Kyiv-Warsaw train was struck near the Polish border, Ukraine's state railway firm said on Sunday. No passengers were injured. Ukrainian Railways said that the country's railways were facing systematic attacks for a second day and warned of widespread delays.
Saudi Arabia has temporarily shut down its 1,200-kilometre East-West oil pipeline after it was hit by a drone attack, with Riyadh and Baghdad saying the strike originated from Iraq.
Swedes vote in an election on Sunday (13 September) that could see the far-right enter government for the first time if the country's right-wing parties can form a majority.
Russia's Defence Ministry said its forces struck two cargo vessels overnight in the Ukrainian Black Sea port of Chornomorsk, the Interfax news agency reported on Saturday.
The aftermath of Russia’s latest strikes on Ukraine over the weekend, including a drone attack on a train near the Ukraine-Poland border, continues to draw international reaction, as Kyiv reports damage to civilian and critical infrastructure.
U.S. President Donald Trump has pushed back against growing calls for the artificial intelligence (AI) industry to slow down, arguing that maintaining America’s lead over China is more important.
Sweden’s centre-left opposition has taken a slim lead in a closely fought election that could reshape the country’s approach to migration and the far right.
When Iran moved to shut the Strait of Hormuz this year, sending Middle East energy markets into turmoil, China had already spent the best part of a decade getting ready for exactly this kind of shock.
At the southern tip of the Red Sea, where Yemen faces Djibouti and Eritrea across a channel only around 30 kilometres wide at its narrowest, lies one of the world's most consequential waterways: the Bab el-Mandeb Strait.
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