Trump's trade wars = Death for the crypto market.
🖱You don't have to be particularly gifted to understand that the 25% tariffs on Canada and Mexico will drive inflation up both in the USA and in neighboring countries to Everest. Many expected that the tariffs would be postponed or gradually introduced, starting at 2.5%. Many financial media claimed that 'through channels in the White House, it became known that the tariffs would be canceled.' Despite Trump constantly officially denying all this, everyone continued to sincerely believe in the best.
On February 1, as the radical blonde promised, 25% tariffs were introduced for Canada and Mexico and 10% on oil, although Donnie initially promised not to touch 'black gold' :)
🖱It is also worth noting the 10% tariffs on China, which has already promised to 'take retaliatory measures.' Well, one can only ask the tarot readers from the Patricks what 'measures' they will take. Based on China's previous actions towards the USA, revenge will likely be brutal.
🖱Why is this even important? Let's turn to the logical question: 'How exactly will the tariffs affect inflation?'
1) Tariffs on oil will raise fuel prices in the USA, and fuel is one of the main catalysts for inflation decline/increase. Fuel determines the final price of a huge number of goods and services, so it is not difficult to make a fairly confident conclusion - this will force the Fed to keep rates high.
2) The previously mentioned Canada and Mexico are major suppliers of agricultural products; tariffs on this sector will also affect price increases in the USA.
High Fed rates will slow down the flow of money into both the stock market and the crypto market. Let's not forget that 'extra money' goes into crypto, which means that crypto depends on the 'value of money.'
