The US Supreme Court's landmark verdict, striking down Trump's global tariffs, has resonated with the global financial markets buyoing the equities market, and commodities, including gold as well as silver.
The markets have reacted positively to the Supreme Court decision, hours after Donald Trump's broad tariff regime was struck down, ruling that he exceeded his authority under the International Emergency Economic Powers Act (IEEPA) to impose these sweeping duties on imports.
In a 6-3 decision, the Supreme Court said that IEEPA, a law designed to address genuine national emergencies, does not in any way authorise the imposition of wide-ranging tariffs unilaterally.
The court emphasised that the authority of tariff-setting rests with Congress, not the executive branch. The verdict is being seen as a significant setback to a central pillar of Trump's trade policy, the experts have maintained.
The most stark effect of the verdict was seen in the Silver rally, soon after. Silver rose by more than 5 per cent today, and was trading at $82.38 per ounce, while this report was being filed.
Gold, on the other hand, rallied by more than 1.41% and breached the $5,000 mark. It was trading in green while this report was being filed.
Soon after the verdict, the global markets rallied as investors could sense a reduction in the uncertainty caused by these tariffs. Major US indices rose modestly, while European and Asian shares also advanced in early trading.
Treasury yields also edged higher, on the benchmark 10-year note in particular. Traders are factoring in the possibility of increased government borrowing, with tariff revenues potentially eliminated.
The US dollar, however, has slightly weakened as trade tensions eased and risk appetite improved.
In the US, meanwhile, Democratic senators have welcomed the court striking down the tariffs. Assistant Minority Leader Dick Durbin, D-Illinois, said that the policy was “misguided” and created a burden on families as well as businesses.
“This ruling is a win for the American people, and in a rare instance, shows the Supreme Court can use its constitutional authority to stop the corruption and chaos of the Trump Presidency,” Durbin said in a statement, and was quoted by the news outlet USA Today.
Trump, meanwhile, was notified of the decision in his morning meeting with Governors at the White House. He has called the Supreme Court decision a “disgrace”, the Associated Press (AP) has quoted people who had a firsthand account of the President's reaction to the verdict.
In India and other Asian countries, the markets will open on Monday. It will be interesting to see how the markets will react to the news.
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