This policy shift in favour of gold could translate into a more than $27 bn of inflows according to Minsheng securities. More from China: the latest data showed that China’s official gold holdings rose significantly over the past two years. In fact, the country increased its official reserves by around $105.5bn in two years and 77% of that rise was accounted for by gold.

Over one year, 124% of the increase was due to the increase in gold holdings meaning that China is increasing its gold holdings in expense of treasury holdings to hedge itself against the tight trade and geopolitical environment that could get tenser and uglier very quickly.

And it’s not only China, many other countries including Turkey, India and the Easters European countries buy gold - and commit to buy more – to build their reserves on a supranational asset that doesn’t carry the US/Trump risks. Consequently, yes, gold remains the ultimate Trump hedge – as I said earlier this year – and Trump makes the $3000 per ounce target easily achievable.

Elsewhere, the early moodiness due to Trump’s new tariff threats quickly waned. The euro and Loonie recovered losses against the greenback, while the stock markets in Europe gave a mere reaction to Trump news – if it gave any reaction at all.

The energy and mining heavy FTSE 100 led gains in Europe, goldminer Fresnillo jumped almost 5% to a year-high, while BP rallied more than 7% on news that the activist investor Elliott Investment Management has acquired a substantial stake in the company to increase focus on traditional oil and gas operations and rely less on investments in renewable energy.

BP is announcing quarterly results this morning.

Across the Channel, the Stoxx 600 extended gains to a fresh ATH as well,  while in the US, the S&P500 gained. US Steel Corp and Alcoa were happy about the tariff news, while the tech stocks led the rally. Nvidia extended gains by more than 2.50% as the French PM promised to invest more than 100bn euro in AI at a tech summit in France. Still, when we talk about AI and tech progress in Europe, we talk a lot about how to regulate. As such, regulation will likely be a speed bump to European tech companies in a global race where others don’t face the same barriers.

But appetite for rotation towards the European cyclical stocks is expected to maintain the positive momentum in the European indices – even though the underlying fundamentals are not ideal. After all, the slower the economies and the murkier the outlook, the more supportive the European Central Bank (ECB) will be. The only thing, the ECB needs is to keep inflation under control. The rest is just a detail for stock valuations.

In the FX, the US dollar remains in demand as the Federal Reserve (Fed) Chair Jerome Powell begins his two-day testimony in front of US politicians today and is expected to adopt a cautious approach despite mounting pressure to lower rates from the Trump government. After all, US growth remains solid, the jobs market healthy, and inflation sticky. And Trump’s growth-boosting policies and tariff threats threaten to make it stickier.

As such, a hawkish stance from Powell could further boost the dollar appetite and temper gains in US equities. Also note that, besides the fact that a hawkish shift in Fed policy is bad for valuations – the appreciation of the dollar tends to weigh on Big Tech companies’ earnings from outside the US. That’s an added headwind for companies like Tesla, Nvidia, Amazon, and Alphabet, whose slowing earnings growth is already unsettling investors.

In energy, US crude jumped nearly 2% yesterday despite the renewed tariff threats that could’ve been negative for sentiment as it is not promising for global growth expectations, but the price of a barrel is drilling above the 50-DMA this morning. Trend and momentum indicators hint that the bullish move has room to expand, but resistance is seen at $74.50 mark, near the 200-DMA and the major 38.2% retracement on the latest selloff.