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How the Dollar, Gold and Silver Reacted to Reports of Changes to Trump’s Tariff Plan

فرزانه صالحی
Oct 1
2 min read

By Farzaneh Salehi


A look back at a past event, associated with the Washington Post report of 6 January 2025.


Editor’s note: This is a historical article. Its figures and references to market conditions relate to the time of the original note, not the market today. As the author stated, the news under discussion had not yet been confirmed when she wrote it.


The US dollar fell noticeably following reports that Trump’s team was considering a revised, less stringent tariff plan. Trump’s 2024 campaign had promised broad tariffs on most goods. During the campaign, he repeatedly spoke of a “universal” import tariff of 10–20% on foreign-made goods, a 60% tariff on imports from China and a 100% tariff on imported cars.


Reports at the time, however, suggested that his aides were working on a plan focused on sectors critical to national or economic security rather than all imports. These included defence supply chains such as steel, iron, aluminium and copper; essential medical supplies such as syringes, needles, vials and pharmaceutical materials; and energy production, including batteries, rare-earth minerals and solar panels.


Following the news, the dollar index fell by around 1% to below 108. Although the report had not yet been confirmed, the market response could suggest that dollar strength at that point depended more on fiscal policy than on monetary policy.


In the author’s interpretation, tariffs on all goods could have benefited gold, while limiting tariffs to selected goods could have reduced other countries’ concerns. Nevertheless, immediately after the news, gold benefited from the weaker dollar index and rose by around $15 to $2,650 per ounce. It subsequently pulled back and gave up the entire gain.


Silver also rose by around 2% after the news, but subsequently surrendered almost all of that increase and returned below $30 per ounce.


Farzaneh Salehi — author of this note. Photo used with the author's permission.
Farzaneh Salehi — author of this note. Photo used with the author's permission.

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