US President Trump caused sharp price movements in the markets in his first 3 months in the White House. In fact, similar movements occurred in Trump's first term. While gold and the VIX Index increased in the first 3 months of Trump's term, the dollar and oil decreased. However, the waves were much higher in the second term. US President Donald Trump has been shaking the markets all over the world since he took office on January 20. Stocks, forex, commodity and crypto markets have literally turned into 'elevators'. On the one hand, customs duties announced against the whole world and on the other hand, geopolitical statements instantly affect prices in the markets.
The price movements experienced before and after Trump's statements have also brought to light the claims of manipulation. Trump, who took action to quickly implement tariffs after taking office, had made the statement on his social media account, “Calm down! “This is a great time to buy” before announcing that the tariffs he announced would be applied to countries other than China would not be applied for 90 days. When the 90-day pause in tariffs was announced shortly after this statement, stock markets rose rapidly.
Trump toned down his statements about China the day before. Stating that he would not play hardball against China on the subject of tariffs, Trump said, “We will be very gentle. They will be very gentle. We will see what happens next. But ultimately, they have to make a deal. Because otherwise they will not be able to do business with the US,” he said. While this statement by Trump added an average of 2.5 percent to stocks on Wall Street, cryptocurrencies turned their direction. Again, oil prices and the ounce price of gold, which had reached historic highs, fell. This extreme volatility experienced in the markets after Trump took office keeps investors on their toes at all times. A new surprise can come from Trump at any moment. Because Trump can say the exact opposite of what he says today tomorrow.
In fact, Trump is the same Trump. In other words, Trump, who sat in the White House between 2017-2021, followed a similar strategy during that period. Trump, who also emphasized protectionist policies back then, is the same in his second term. When you look at the balance sheets of the first 3 months of Trump’s first and second presidential terms, it is striking that the markets are moving in the same direction again. The only difference is the intensity of the reactions given by the markets. For example, the ounce price of gold, which was $1,190 on January 20, 2017, when Trump took office in his first term, increased to $1,190 on April 22, 2017. It rose to $1,267. In other words, the ounce value of gold increased by 6.47 percent during this period. Trump’s second term started on the same date, January 20. The ounce of gold increased by 22.4 percent in the first 3 months of the second term.
Due to trade wars, the dollar had also lost value globally in the first 3 months of Trump’s first term. While the dollar fell by about 2 percent against the euro between January 20 and April 22, 2017, this year the loss of value has approached 10 percent. When we look at the movement in the barrel price of American crude oil, the situation is no different. Oil prices fell in the first 3 months of Trump’s first and second terms. However, as I said above, although the markets are moving in the same direction, the magnitude of the reactions is much higher this year.
It is seen that the only movement in a different direction between Trump’s first and second terms is in the stock market. The Dow Jones Index on Wall Street, which rose by 4.22 percent in the first three months of Trump’s first term, fell by 9.89 percent in the first three months of his second term. It is thought that the significant rally in stock markets before Trump may have caused this difference.
