President Trump’s recent tariff escalation, dubbed “Liberation Day,” has sparked a trade war with China, sending shockwaves through the markets. The resulting growth scare has led to a significant drop in commodity prices, reflecting concerns about the worsening macroeconomic conditions.
According to Goldman analyst Michael Nocerino, commodities like WTI, copper, and natural gas have taken a hit, with prices plummeting. The Bloomberg Commodity Index is on track to record its largest weekly decline in over a year, down 4%.
Citigroup’s head commodity analyst, Max Layton, predicts that the tariff wars will continue to weigh on commodity prices, particularly copper, which he expects to slide further in the coming weeks. This outlook has led to a bearish sentiment in the market, with CME Copper futures set to record their worst performance since the early days of the Covid crash.
Goldman analysts Thales Arruda and Rich Privorotsky warn of the indirect negative impact of the reciprocal tariffs on commodities, predicting a global recession as trade barriers increase. This grim outlook has forced copper bulls to reassess their price targets, putting their bullish stance on hold.
Overall, the escalating tariff war between the US and China is causing turmoil in the markets, with commodity prices taking a hit. The uncertainty surrounding the situation has investors on edge, with many bracing for further volatility in the coming months.
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