Gold Jumps, Silver Slides After Trump “Liberation Day” Tariff Announcement

 

Gold Jumps, Silver Slides After Trump’s “Liberation Day” Tariff Announcement

(Bullion News Network) – Gold surged once again to end the midweek trading session as U.S. President Donald Trump confirmed his plans for a sweeping set of tariffs he has called “Liberation Day.” Economists are saying that these tariffs represent a historic shakeup that could have major implications for both the domestic and international economy. President Trump’s tariffs, he relayed in a speech in the White House Garden, will amount to a blanket 10% fee on imported goods from all American trade partners, as well as reciprocal tariffs that vary from country to country based on the percentage of tariffs those countries currently levy against the United States. The “worst offenders,” according to the U.S. leader, may face tariffs of up to 50%. 

Wall Street slid during after-hours trading as President Trump spoke. The Dow dropped over 750 points, while the S&P 500 slid 3% and the Nasdaq-100 lost a total of 3.8%. Traders expected big news out of today’s announcement, but most analysts anticipated a universal tariff cap in the range of 10-20%. Instead, a baseline tariff of 10% on all trading partners and far greater charges levied against certain countries have injected fresh fear and instability into American and global markets. Even tech shares, which buoyed Wall Street throughout 2024, slid on the news amid a highly risk-averse mood among traders. 

Cryptocurrencies were also not immune to risk-averse buying behavior during President Trump’s announcement. Bitcoin jumped early in the day, climbing from $84,661.13 to a daily high of $87,845.87 leading up to the White House speech. The tariff announcement erased all of those earlier gains, rapidly driving BTC to a daily low of $83,391.18. President Trump did not mention cryptocurrencies in his speech, and analysts say that cryptocurrencies like Bitcoin may be the first assets to go in modern portfolios when markets shy away from risks amid a high degree of uncertainty. 

Gold and silver initially came out on top during after-hours trading, with gold driving past $3,136/ozt as silver tried once again to establish a support above $34 per troy ounce. Silver’s gains dissipated in hours after President Trump’s speech, driving the metal down nearly $0.50 per troy ounce. Most notably, the lopsided price action briefly pushed the gold-silver ratio above 93.5:1 to its highest point since 2022. Gold extended its gains after market close, crossing $3,140/ozt to set yet another all-time high amid a highly uncertain economic environment. The past few weeks have been dominated by uneven price action across the two markets. Gold’s sustained bull run has kept the gold-silver ratio consistently above 88:1 for the entirety of 2025, and U.S. banks believe that the gold price run is likely far from over. 

Despite today’s tariff shock, markets are now turning to several key economic events scheduled for later this week. An initial jobless claims report will be released tomorrow and should shed more light on the state of the labor market. Later that day, traders will get to read the March S&P final U.S. services PMI report before hearing from Fed Vice Chairman Philip Jefferson and Fed Governor Lisa Cook. 

Friday should be an eventful day for markets. The day of key economic data releases begins with the March employment report and rate. The unemployment rate is projected by economists to remain unchanged at 4.1%, while the employment report is expected to decrease from 151,000 to 140,000. U.S. hourly wages are not expected to change from February’s .3%, while hourly wages year-over-year are projected to drop marginally from 4.0% to 3.9% for the month of March. 

Federal Reserve Chair Jerome Powell will speak on Friday, and analysts expect his comments to play a key role in how traders interpret both the week’s economic data findings and the general economic outlook in the face of President Trump’s tariff shakeup. Forecasters still anticipate that the Fed will likely opt to keep interest rates unchanged at its May meeting, with CME FedWatch projecting only an 8.9% probability that the FOMC will vote to reduce rates by 25 basis points during that meeting. Although the FOMC believes that the U.S. economy remains in “solid” shape, Chair Powell previously expressed concerns that the White House’s unprecedented approach to economic policy could delay the Fed’s process as the FOMC aims to gradually reduce policy restraint: 

Inflation has started to move up now, we think partly in response to tariffs and there may be a delay in further progress over the course of this year. So, that’s the hard data. Overall, it’s a solid picture.

The FOMC still projects two rate cuts for 2025, but the Committee remains highly attentive to changes in both employment and inflation. At the March 19th press conference, Chair Powell said that the tone and tenor of economic data reports will play a key role in how the Fed votes at upcoming meetings. 

As the economy evolves, we will adjust our policy stance in a manner that best promotes our maximum employment and price stability goals. If the economy remains strong and inflation does not continue to move sustainably toward 2 percent, we can maintain policy restraint for longer. If the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly. 

Traders will certainly be watching to see how Chair Powell interprets both the week’s data reports and the potential impact that President Trump’s “Liberation Day” tariffs could have on the general economic outlook. Interest rate cut speculation drove much of gold’s historic price action in 2024, so precious metal investors will likely tune in to see how Powell’s comments play into the implied likelihood that the Federal Reserve will act to preemptively cut rates ahead of what economists are calling a potentially inflationary economic play by President Trump’s White House. 

Gold continued to add to its all-time high after market close and is now within a few dollars of breaking another barrier at $3,150/ozt. Silver prices recovered slightly from their post-tariff announcement rout but remain down $0.35 on the day. The gold-silver ratio is currently over 93:1, a year-to-date high.