Global financial markets witnessed a turbulent session today, with sharp declines across Asia, the United States, and Europe. The ripple effect of this widespread market panic directly impacted India’s precious metals, leading to one of the steepest single-day drops in gold and silver prices this quarter.

The selloff began in Japan, where the markets were rattled by a combination of rising inflation, a renewed fear of interest rate hikes, and a heavy crash in AI-linked stocks. The shockwaves quickly spread to the rest of Asia, pushing investor sentiment deep into negative territory.

---

Asian Markets in Chaos: SoftBank Falls 10 Percent

Asian indices opened in deep red, with several heavyweight technology and semiconductor companies facing aggressive selling pressure.

Key declines included:

• SoftBank down 10%
• Advantest down 9%
• Tokyo Electron nearly 6% lower
• Lasertec slipped 5%
• Renesas Electronics fell 1.95%

Japan’s core inflation rising at the fastest pace since July intensified concerns that the Bank of Japan may be forced to tighten its monetary policy. The fear of an interest rate hike added further stress to the market, driving indexes downward.

Markets in South Korea, Hong Kong, China, and Australia also witnessed similar selling pressure, creating a widespread risk-off environment across the continent.

---

US Markets Mirror the Decline

The US stock market followed the same trajectory, with major indices turning sharply lower from the opening bell.

• Dow Jones closed 400 points lower
• Nasdaq fell more than 2%
• S&P 500 dropped 0.8%

The primary trigger was a broad-based selloff in AI and tech stocks, coupled with diminishing hopes that the Federal Reserve would announce a rate cut soon.
This combination significantly weakened global investor confidence.

---

Gold and Silver Prices Drop Sharply in India

The intense global selling pressure spilled over into the commodity markets as well, pulling down gold and silver prices in India.

Gold Price (5 December Morning)

Price: ₹121,838 per 10 grams
Change: ₹900 decline per 10 grams

Silver Price (Today’s Rate)

Price: ₹150,812 per kilogram
Change: ₹3,340 decline per kilogram

This marks the second consecutive day of steep corrections in both precious metals.

---

Indian Stock Market Also Slips

Tracking global cues, Indian equities fell significantly:

• Sensex dropped 200 points
• Nifty plunged 60 points
• Bank Nifty lost 255 points

The selling pressure was uniform across sectors, reflecting broad-based weakness.

---

What Caused the Sudden Global Meltdown?

Analysts point to several interconnected factors:

• Crash in major AI and tech stocks
• Rising inflation concerns in Japan
• Reduced expectations of a US interest rate cut
• Weak global sentiment and risk-averse investor behavior
• Shift toward safer assets

Together, these factors triggered a sharp fall in equities and commodities worldwide.

---

Will Gold and Silver Prices Drop Further?

Market experts believe that:

• If the downturn on Wall Street continues
• And selling pressure persists in Japan and China

Gold and silver could see additional correction in the coming days.

However, India’s upcoming wedding and festival season may support retail demand later, helping stabilize prices.

The Commonwealth Bank of Australia (CBA) has issued a stark warning: the Australian dollar could suffer a “violent reversal” if Donald Trump proceeds with a fresh wave of tariffs aimed at countries aligned with BRICS.

In a move that sent shockwaves across financial markets, Trump threatened on Monday to impose a 10% tariff on all countries “supporting anti-American BRICS policies,” which includes China, India, Brazil, South Africa, and Russia. The announcement triggered an immediate reaction in currency markets, with the Aussie falling 1% to US64.86¢.

UBS warns spike in U.S. tariffs (10–70%) is dragging on global growth. Avg tariff ~16%, adding ~$500 B in import costs. With July 9 deadline looming, markets are jittery. $SPY $DXY pic.twitter.com/wMQjBfrFKj

— MarketPlays (@MarketPlaysApp) July 7, 2025

Adding to the turbulence, Trump signed an executive order initiating 25% tariffs on Japanese and South Korean goods, although enforcement has been deferred until August 1, giving allies a short window to negotiate.

Meanwhile, the Reserve Bank of Australia (RBA) shocked economists by holding the cash rate at 3.85%, sparking a temporary rally that pushed the Aussie up 1% to US65.39¢ on Tuesday.

“The Aussie dollar is at risk of a sharp fall,” said Kristina Clifton, CBA’s currency strategist. “AUD could quickly drop by US2¢, US3¢, or even US4¢ if President Trump follows through on his tariff threats.”

---

Trump’s BRICS Ultimatum: Where Does Australia Stand?

While Australia has not been explicitly named, its economic ties to China, India, and the wider Asia-Pacific region make it dangerously exposed.

The Australian dollar is often seen as a proxy for Asian currencies, and therefore reacts sharply to any trade headlines involving the region. With BRICS nations in the crosshairs, Australia is “guilty by association” in the eyes of global investors.

“Concerns about an escalation in the U.S. trade war with Australia’s partners has cut short the Aussie’s recent rally,” Clifton warned.

---

What Happened in April: A Harsh Reminder

In early April 2025, Trump launched what his administration dubbed “Liberation Day Tariffs”, a sweeping measure that disrupted financial markets and sparked sell-offs across multiple currencies.

Back then, the U.S. dollar surged as a short-term safe haven, but the rally didn’t last. As fears of recession grew, the U.S. Dollar Index posted a historic 10.8% drop in the first half of 2025—the worst performance since 1973.

Ironically, this helped support the Australian dollar… until now.

---

August 1: Countdown to Currency Chaos

The new executive order defers tariffs until August 1, allowing a three-week grace period for negotiations. But analysts warn this could be the calm before another financial storm.

“FX markets were largely relaxed heading into July 9. But Monday’s mood was different—like a trauma flashback to Liberation Day,” said Richard Franulovich, Head of FX Strategy at Westpac.

Franulovich noted that implied volatility had been subdued but is now expected to spike as investors reassess risk.

---

A Glimmer of Hope: US-China Dialogue

There is cautious optimism about improving U.S.-China relations. Beijing recently took action to restrict exports of fentanyl precursors—substances blamed by Washington for fueling America’s opioid crisis.

This goodwill gesture has raised hopes that the “fentanyl tariffs”—20% levies imposed by Trump on Chinese goods—might be lifted. Franulovich believes such a move could “unlock a material reset for the Aussie.”

“The U.S.-China truce appears intact for now. That’s the silver lining,” he added.

---

But Vietnam Complicates the Equation

The recent interim trade deal between the U.S. and Vietnam, which slaps a 40% tariff on trans-shipped goods, may pose a new headache for China and, by extension, Australia. Many Chinese firms have rerouted goods through Vietnam to bypass existing U.S. tariffs—a loophole this new agreement aims to close.

The message is clear: even indirect trade routes are now under Trump’s scrutiny.

---

Australia’s Silent Tightrope

Although Australia has not publicly aligned with BRICS, its reliance on China for exports—particularly iron ore and agricultural products—makes it vulnerable. If Trump views Australia’s neutrality as complicity, tariffs or financial retaliation could follow.

“Even with stable interest rates, the Aussie can’t escape Trump’s trade war shadow,” Clifton emphasized.

---

Conclusion: Is the Rebound Just a Mirage?

I'm not forecasting anything.

But, BABA along with many of the 🇨🇳 companies have suffered through US propaganda & malicious tariff threats. Today is no different! pic.twitter.com/IXGFBET2uz

— Trader Chris (@5littlebass) July 7, 2025

The RBA’s surprise decision gave the Australian dollar a short-term boost, but experts believe the real driver will be Trump’s next move. Will the U.S. President follow through on his tariff threats or seek last-minute deals?

Until then, currency markets are jittery—and investors are watching every headline, every tweet, every diplomatic signal.

Because for the Aussie dollar, the worst may still be ahead.

What began as a ripple in 2018 has now turned into a full-blown shockwave. With Donald Trump announcing an aggressive tariff hike on steel and aluminium imports—including finished products—Indian exporters are sounding the alarm bells.

The most recent blow came on February 10, 2025, when Trump removed all exemptions and enforced a 25% tariff on steel and aluminium derivatives, doubling down on the protectionist stance he adopted during his first term. For Indian manufacturers like Aditya Garodia, it was more than just a policy shift—it was a business nightmare.

It’s like a nail in the coffin said Garodia, director of Corona Steel Industry Pvt Ltd, whose unit exports fasteners and steel products from West Bengal. “Thirty percent of our orders were cancelled.

For years, the United States was a lucrative market for Indian steelmakers. In 2023 alone, India exported $4.56 billion worth of iron, steel, and aluminium products to the U.S. But since Trump’s return to office, rising tariffs have paralyzed that trade pipeline. Garodia notes that customers are delaying payment cycles by up to a month, and many are now in a “wait-and-watch” mode.

"The present scenario is harming small entrepreneurs like us."

Trump’s tariffs are hitting small ancillary firms hard, especially those supplying Indian foundries and relying on steel and aluminium exports https://t.co/RWU613JRg9 pic.twitter.com/dqeVnJ79Vc

— Al Jazeera English (@AJEnglish) July 7, 2025

Small Factories, Big Losses

While larger steel corporations may have buffers, ancillary units and smaller foundries—which form the backbone of India’s manufacturing sector—are bleeding. These businesses, often with razor-thin margins, depend on volume exports and timely payments. The sudden drop in U.S. orders is proving catastrophic.

Domestic demand isn’t helping either Garodia added. “Cheaper Chinese products have flooded the Indian market, and our competitiveness is eroding.

This has led many exporters to urge the Indian government to renegotiate better terms with the U.S., possibly requesting lower tariff bands or country-specific exemptions.

“Tariffs Play Well in Politics” But Not in Economics

The policy traces back to Trump’s 2018 decision to invoke Section 232 of the Trade Expansion Act of 1962, citing national security concerns. Initially, tariffs of 25% on steel and 10% on aluminium were imposed. While some finished goods escaped scrutiny back then, the latest action removed all loopholes.

Yet the effectiveness of these measures is increasingly in question.

Since the tariffs were first implemented in 2018, U.S. steel imports have actually increased,” said Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI).
They haven’t cut imports or boosted production… they’ve mostly stuck around because they play well in politics.

According to Srivastava, U.S. steel imports rose from $98.6 billion in 2018 to $114 billion in 2024, contradicting the administration’s stated objective of reviving domestic production.

The Road Ahead: Renegotiation or Ruin?

As things stand, Indian exporters are in limbo. There is hope that diplomacy could offer a reprieve—perhaps in the form of bilateral deals, tariff waivers, or World Trade Organization (WTO) mediation.

But for small business owners like Garodia, survival may depend on how quickly New Delhi can act—or how soon Washington rethinks its tariff crusade.

This isn’t just about trade numbers,” Garodia warned. “It’s about jobs, families, and the future of small Indian manufacturers.