The Potential Impact of Trump's Return on Commodity Markets
Now that Biden has withdrawn from the re-election race, the likelihood of Trump coming to power again has significantly increased. This, in turn, promises substantial prospects for commodity markets.
Experts note that Trump's victory could potentially trigger a new price boom in the commodity market. A key factor here is his stance on tariffs - Trump plans to introduce 60% tariffs on imports from China and 10% tariffs on imports from other countries.
Such measures are likely to cause a new wave of global inflation, which will inevitably lead to higher prices for gold, silver, and other precious metals. It is enough to recall how during Trump's previous presidency, the price of gold rose from $1200 to $1900 per ounce.
In addition, Trump's tough tariff policy could provoke similar retaliatory measures from China. As practice shows, Beijing usually responds to new tariffs by expanding economic stimulus programs, primarily by increasing investments in infrastructure.
Such a scenario will undoubtedly become a positive driver for a range of base metals - aluminum, copper, lithium, nickel, iron ore, zinc, and uranium, which are traditionally in demand for China's infrastructure projects.
The risk of renewed trade wars could trigger a "super squeeze" in agricultural markets - from soybeans to corn, leading to prices soaring to record levels.
Thus, Biden's unexpected withdrawal from the presidential race paves the way for the return of "Trump's trade policy," promising significant prospects for commodity markets in the near future.
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