Markets are bracing for another twist in President Donald Trump’s tariff saga as his 90-day “pause” deadline approaches next week. The three-month reprieve, meant to give trading partners time to strike new deals or face steep tariffs, has sent investors on a wild ride—yet surprisingly, many now expect another delay rather than fireworks.
Global equities have staged an impressive comeback since Trump’s “Liberation Day” tariff threat in early April. The MSCI World Index, which plunged 10% in the days following the announcement, has rebounded over 11% and logged fresh record highs. The S&P 500, once lagging, has closed the gap too up more than 10% since April 2. However, a weaker dollar has dulled the shine for overseas investors; in euros or pounds, the S&P is still well below its previous peaks.
The U.S. dollar itself has had a rough ride. The dollar index is down nearly 11% for the year—its worst first half since 1973—thanks to tariff jitters and renewed U.S. debt fears. Against the euro, peso, and Canadian dollar, the greenback has lost even more ground. Some analysts predict the euro will push toward $1.30 or higher by next year.
For exporters, clarity is the real prize. European automakers and pharma giants have mostly rebounded but remain sensitive to tariff headlines. A rumored universal 10% tariff deal could calm nerves, while higher rates would likely shock markets again.
Meanwhile, gold is glittering amid all this uncertainty. Up 26% this year, it has outshone bitcoin and AI darlings like Nvidia. A growing crowd of investors and central banks are betting gold is the safest hedge against Trump’s unpredictable trade chessboard—and a wobbly dollar.
