There are signs the world is losing faith in the dollar

Published

6 months ago

April 25, 2025

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First he took the US on a collision course with China. Then he came for the rest of the world.

He crashed into the financial markets and now Donald Trump has been gently tapping on the brakes all week.

The world’s economic policymakers have been on quite the journey over the past few months.

Many of them will have felt a little queasy as they got off the plane in Washington DC for the International Monetary Fund’s (IMF) annual spring meetings.

This was their opportunity to talk. To strategise, strengthen alliances and figure out their next move.

Rachel Reeves was in the mix. While all the focus has been on a US-UK trade deal – and she is due to meet her US counterpart on Friday – the chancellor was also here to meet her G7 and G20 allies.

Countries across the world are eager for Mr Trump to reduce his tariffs but they are also looking to each other, reflecting on how the world might look in the future and whether the US is a reliable long-term partner.

That much was obvious from a conversation with Paschal Donohoe, Ireland’s finance minister and president of the Eurogroup.

He told Sky News that Ireland, a highly US-orientated economy, was diversifying.

That being said, he was “more optimistic than some” that a high level of trade integration would prevail well into the future.

“What I think is very possible is the structure of that globalisation could begin to change,” he said.

That changing structure might include a rejection of China’s decades-long model of export-led growth.

Since joining the World Trade Organisation in 2001, China has been pumping out cheap goods into the world economy, making far more than it consumes at home.

Poor countries across the world have taken a similar approach to development but the US Treasury secretary said on the sidelines of the IMF on Wednesday that it was “absurd” for multilateral institutions to continue treating China like a developing economy.

He called for a “rebalancing”.

There is a recognition among world leaders that some of Mr Trump’s grievances are reasonable.

They believe his approach is the wrong one but in interviews they are now talking about the negative consequences of trade imbalances and globalisation – the impact on communities and the undercutting of wages.

That wasn’t the case just a few months ago.

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Ms Reeves took it one step further. On Wednesday, the Treasury announced plans to tackle the dumping of cheap goods into the UK – no doubt aimed at China.

She announced a review of the customs’ treatment of low-value imports.

Currently goods valued at £135 escape the duty. The US has already taken action.

In an interview with Sky News, she said she was acting in the “national interest” but she is also looking for common ground with the Americans, as she seeks a deal that secures a reduction in tariffs.

Speaking to US media on Thursday, she reiterated her shared concerns: “I absolutely understand the concerns the United States have about imbalances in trade in the global economy, particularly when it comes to China that runs large, persistent trade surpluses with countries around the world, including the US and indeed including the United Kingdom.”

The IMF too. While the Fund sharply downgrades global growth forecasts, it shied away from openly criticising the US president.

Kristalina Georgieva, the IMF’s managing director, spoke of an erosion of trust between countries, and “concerns about the uneven distribution of gains from economic integration, its impact on the international division of labour, supply chain security, and global imbalances”.

So, Mr Trump has got policymakers to shift their priorities.

At the very least, he has brought a long-simmering issue to the boil. The world is thinking differently about China now.

The US is also showing signs that it’s thinking differently. After a bruising showdown with the bond markets, Mr Trump has rowed back on his liberation day tariffs.

The administration has softened its language, saying it wants reform and to work with institutions.

The president said tariffs could come down substantially on China.

However, a lot of damage has already been done – not only his erratic tariffs policy, but also his attack on institutions, including the US Federal Reserve.

The world is now thinking differently about the US too, as are the markets.

Investors normally dive into US assets – government debt and the dollar – during times of turmoil, but Mr Trump’s pronouncement has caused traders to do the opposite.

There are signs that the world is losing faith in the US’ ultimate safe haven status.

US

Donald Trump threatens to impose additional 100% tariff on ‘extraordinarily aggressive’ China

Published

16 hours ago

October 11, 2025

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Donald Trump threatens to impose additional 100% tariff on 'extraordinarily aggressive' China

Donald Trump has announced the US will impose an additional 100% tariff on China imports, accusing it of taking an “extraordinarily aggressive position” on trade.

In a post to his Truth Social platform on Friday, the US president said Beijing had sent an “extremely hostile letter to the world” and imposed “large-scale export controls on virtually every product they make”.

Mr Trump, who warned the additional tariffs would start on 1 November, said the US would also impose export controls on all critical software to China.

The president added that he was imposing the tariffs because of export controls placed on rare earths by China.

He wrote: “Based on the fact that China has taken this unprecedented position, and speaking only for the USA, and not other nations who were similarly threatened, starting November 1st, 2025 (or sooner, depending on any further actions or changes taken by China), the United States of America will impose a tariff of 100% on China, over and above any tariff that they are currently paying.

“It is impossible to believe that China would have taken such an action, but they have, and the rest is history. Thank you for your attention to this matter!”

Mr Trump said earlier on Friday that there “seems to be no reason” to meet with Chinese leader Xi Jinping in a scheduled meeting as part of an upcoming trip to South Korea at the end of this month.

He had posted: “I was to meet President Xi in two weeks, at APEC, in South Korea, but now there seems no reason to do so.”

The trip was scheduled to include a stop in Malaysia, which is hosting the Association of Southeast Asian Nations summit, a stop in Japan and then the stop to South Korea, where Mr Trump would meet Mr Xi ahead of the Asia-Pacific Economic Cooperation summit.

Mr Trump added: “There are many other countermeasures that are, likewise, under serious consideration.”

The move signalled the biggest rupture in relations in six months between Beijing and Washington – the world’s biggest
factory and its biggest consumer.

It also threatens to escalate tensions between the two countries, prompting fears over the stability of the global economy.

Friday was Wall Street’s worst day since April, with the S&P 500 falling 2.7%, owing to fears about US-China relations.

China had restricted the access to rare earths ahead of the meeting between Presidents Trump and Xi.

Under the restrictions, Beijing would require foreign companies to get special approval for shipping the metallic elements abroad.

US

Tennessee: Multiple people killed and others missing after explosion at military munitions plant

Published

23 hours ago

October 10, 2025

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Tennessee: Multiple people killed and others missing after explosion at military munitions plant

Multiple people have been killed and others are missing after an explosion at a Tennessee military munitions plant.

Secondary explosions have forced rescuers back from the burning site at Accurate Energetic Systems, according to the Hickman County Sheriff’s Office.

Humphreys County Sheriff Chris Davis told a news conference: “We do have several people at this time unaccounted for.

“We are trying to be mindful of families and that situation. We do have some folks. We can confirm that we do have some that are deceased.”

The cause of the blast, which occurred at 7.45am on Friday (1.45pm in the UK), was not immediately known.

Video from the scene showed flames and smoke billowing from a field of debris.

Emergency crews were initially unable to enter the Tennessee plant because of continuing explosions, Hickman County Advanced MT David Stewart said.

Residents in Lobelville, a 20-minute drive from the scene, told the Associated Press that they felt their homes shake and some people captured the loud boom of the explosion on their home cameras.

Gentry Stover, who was woken from his sleep by the blast, said: “I thought the house had collapsed with me inside of it.

“I live very close to Accurate and I realised about 30 seconds after I woke up that it had to have been that.”

According to its website, Accurate Energetic Systems manufactures products for the defence, aerospace, demolition, and oil and gas industries

It adds that the company makes and tests explosives at an eight-building facility that sprawls across wooded hills near Bucksnort, a town about 60 miles southwest of Nashville.

US

Letitia James indicted for fraud after Donald Trump demanded case against New York attorney general

Published

1 day ago

October 10, 2025

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Letitia James indicted for fraud after Donald Trump demanded case against New York attorney general

Letitia James – New York attorney general and long-time critic of Donald Trump – has been indicted for fraud.

Ms James, a Democrat, was charged on Thursday with one count of bank fraud and one count of making false statements to a financial institution, in connection with a home she purchased in Norfolk, Virginia, in 2020.

The 66-year-old could face up to 30 years in prison and up to a $1m (£752m) fine on each count if convicted, according to Sky’s US partner network NBC News.

Mr Trump has been advocating charging Ms James for months, posting on social media without citing any evidence that she’s “guilty as hell” and telling reporters at the White House: “It looks to me like she’s really guilty of something, but I really don’t know.”

In a lengthy statement, Ms James vehemently denied any wrongdoing and described the indictment as “nothing more than a continuation of the president’s desperate weaponisation of our justice system”.

She said: “These charges are baseless, and the president’s own public statements make clear that his only goal is political retribution at any cost.”

The indictment was presented to a grand jury by Lindsey Halligan, the newly appointed attorney for the Eastern District of Virginia.

Ms Halligan, who has previously worked as a lawyer for Mr Trump, replaced veteran prosecutor Erik Siebert, who had resisted filing charges against Ms James and former FBI director James Comey, who was charged with lying to Congress two weeks ago.

The indictment pertains to Ms James’s purchase of a house in Norfolk, where she has family.

During the sale, she allegedly signed a document called a “second home rider” in which she agreed to keep the property primarily for her “personal use and enjoyment for at least one year”. However, the indictment claims she instead rented it out to a family of three.

According to the indictment, the misrepresentation allowed Ms James to obtain favourable loan terms that are not available for investment properties.

History of Trump and James

Ms James’s indictment is the latest indication that the Trump administration is determined to use the powers of the justice department to target the president’s political and public figure foes.

In a statement on Truth Social last month, Mr Trump called on US Attorney General Pam Bondi, who leads the department, to prosecute his political opponents.

“We can’t delay any longer, it’s killing our reputation and credibility. They impeached me twice, and indicted me (5 times!), OVER NOTHING. JUSTICE MUST BE SERVED, NOW!!!” Trump wrote.

Ms James is a particularly personal target of Mr Trump. During the president’s first term in office, she sued him and his administration dozens of times.

Last year, she won a staggering judgment against the Trump Organization after she brought a civil lawsuit alleging he and his companies defrauded banks by overstating the value of his real estate holdings on financial statements.

An appeals court later overturned a hefty fine Mr Trump was ordered to pay, but upheld a lower court’s finding that he had committed fraud.

What happens now?

Ms James is scheduled to make an initial appearance in the federal court in Norfolk on 24 October.

The case has been assigned to US District Judge Jamar K Walker, who was appointed by Joe Biden.

The standard for securing an indictment before a federal grand jury is much lower than securing a unanimous conviction by a jury at trial, NBC reported.

The Justice Manual, which guides federal prosecutors, says attorneys for the government should move forward on a case only if they believe the admissible evidence – evidence that is allowed to be presented in a court of law – would be enough to obtain and sustain a conviction.