Yen and Gold Surge Amid Tariff Tensions

The Japanese yen and gold surged as traders reacted to potential U.S. tariff announcements that could spark inflation and slow economic growth. The yen rose against the dollar, while gold hit record highs. Markets remain jittery despite President Trump's negotiation hints, with global currencies and stocks experiencing volatility.

The Japanese yen and gold made notable gains on Monday as global markets braced for the impact of U.S. President Donald Trump's looming tariff announcements. The yen strengthened by 0.74% against the U.S. dollar, while gold surged to a record $3,112.14, illustrating traders' apprehension over possible inflation and economic slowdown.

Monday's market movements occurred against a backdrop of concerns sparked by U.S. data pointing to rising core inflation, which intensifies fears of stagflation. Investors shifted towards safe-haven assets, pressuring the dollar and causing a dip in U.S. Treasury yields. The Swiss franc also gained 0.3% against the dollar as a traditional safe harbor in times of uncertainty.

Despite President Trump's suggestion of possible bilateral agreements to mitigate tariffs, market reaction remains tense, with global currencies like the Australian and New Zealand dollars weakening. Analysts warn of potential market disruptions if aggressive tariffs are imposed, emphasizing the risk of a sharp sell-off elevating the U.S. dollar in the short term.

(With inputs from agencies.)