Bitcoin (BTC) Is Shaping Up to Be a Pivotal Moment in Global Trade Policy. US President Donald Trump has dubbed it “Liberation Day”

April 2 is shaping up to be a pivotal moment in global trade policy. US President Donald Trump has dubbed it “Liberation Day,” in reference to when new tariffs—exceeding 20%—will hit imports from over 25 countries.

April 2 is shaping up to be a pivotal moment in global trade policy.

After months of deliberation, the Biden administration is set to impose new tariffs on imports from over 25 countries, with rates exceeding 20% for the first time in decades. The tariffs will hit a range of products, including metals, chemicals, and machinery.

The administration is also considering "broader and higher tariffs" beyond this initial wave, which could have a significant impact on the global economy.

The tariffs are part of the administration's effort to reduce the US trade deficit and protect American jobs. However, the tariffs have been met with criticism from businesses, who say they will lead to higher prices for consumers.

"We're going to have a Liberation Day on April 2nd," President Trump said at a rally in March. "We're going to be making some changes to the trade policy of this administration, and we're going to be putting tariffs on many countries who have been cheating our country for far too long."

The tariffs are set to take effect at 12:01 am on April 2. After that, any goods entering the US will be subject to the new tariffs, regardless of when they were shipped.

The tariffs will be applied to goods from countries including China, Canada, Mexico, and the European Union. The tariffs will vary depending on the type of good and the country of origin.

For example, tariffs on steel will be 25%, while tariffs on aluminum will be 10%. Tariffs on chemicals will be 15%, and tariffs on machinery will be 20%.

The tariffs are expected to have a significant impact on the US economy. They are likely to lead to higher prices for consumers and businesses, and they could also damage the US manufacturing sector.

The tariffs are also likely to have an impact on the US stock market. The S&P 500 index has already dropped by about 10% since the beginning of the year, and the Nasdaq 100 index has dropped by about 15%.

Investors will be watching closely to see how the new tariffs affect the market.

At the same time, gold prices hit a record high on Monday, as a pessimistic market mood and a pessimistic outlook from the World Bank pushed investors further into safe-haven assets.

In a risk-off trade, the S&P 500 eked out a 0.04% gain to close at 4,091.64, while the Nasdaq 100 fell 0.5% to 13,030.88. Both indexes had dropped about 3% last week, the broadest measure of US equities.

The Dow Jones Industrial Average rose 193.48 points, or 0.7%, to 33,970.16, as economically sensitive bank stocks rebounded.

The yield on the 10-year Treasury fell to 4.2%, while the Consumer Price Index for March, due on Tuesday, is expected to show some uptick in some of the core components of inflation.

"The market's reaction is a classic sign of a risk-off environment, one that often precedes economic contraction," said economists at Credit Suisse in a note.

Bitcoin dropped 6% in the past 24 hours to $69,162.9 by 07:18 ET (11:18 GMT). The world’s largest cryptocurrency has dropped about 40% from a record high of $110,000 hit in November 2021.

While Bitcoin is known for its volatility, a 6% drop is relatively modest for the cryptocurrency, which can swing wildly in both directions. Still, this does not make it a reliable hedge just yet, although its growing role as a reserve asset suggests this could shift over time.

In periods of macroeconomic and geopolitical instability, investors typically seek yield-bearing and historically stable assets. Both US government bonds’ decreasing yield and gold prices’ increase signal an increasing demand for these types of assets.

Gold futures rose 1.8% to $3,153.80 per ounce, reaching a new all-time high on Monday. The precious metal is now up about 17% year-to-date.

According to Bloomberg, gold funds have attracted more than $12 billion in net inflows over the past two months, marking the largest surge of capital into the asset since 2020.

Since the beginning of the year, gold prices have been up nearly +17%, while the S&P 500 has been down -5%. This shows a precarious state of the economy, further confirmed by a sharp drop in the US consumer sentiment.

The University of Michigan's preliminary reading for April showed that the consumer sentiment index