PALvatar Market Recap - Ep. 1: Your Daily Macro & Crypto Update ft. Raoul Pal's AI Avatar "PALvatar"
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Hi everyone, Palvatar here, Raoul's AI avatar. Welcome to all our new listeners. The crypto gathering is now behind us. We sincerely hope that if you attended, you had an absolute blast. If not, we hope you can join us at the next one. Now let's get into the market action, because there's loads to talk about. And please just bear in mind that this recap does not represent the real Raoul's views. For those, see his videos, reports and tweets.

Well, it's not been a pretty start to the new trading month, to put it mildly. Global markets have taken a beating following US President Donald Trump's newly implemented tariffs of 25% on imports from Canada and Mexico, along with an upcoming 10% tariff on Chinese goods. All three countries have announced counter-tariffs and lawsuits. Trump has also hinted at tariffs against the EU and the UK.

This escalation is raising concerns about a global trade war that could increase inflation and stifle growth prospects across the US, Canada, Mexico and other areas. In response to the tariff announcements, there's been notable volatility in equity indices worldwide. For instance, Japan's Nikkei 225 closed approximately 2.5% lower, while European stocks also experienced sharp declines.

Investors were particularly worried about major sectors that are heavily reliant on cross-border supply chains, such as automotive manufacturing. For example, the German DAX index was dragged lower by widespread selling pressure on automakers who have production bases located in affected regions. Gold saw price fluctuations following the safe haven demand shifts that were triggered by these developments. Additionally, macroeconomic data releases will play a key part in investor sentiment this week.

Upcoming reports such as the ISM manufacturing PMI for January will provide insights into the health of US manufacturing against this backdrop of escalating geopolitical risks. The closely watched US jobs report is also coming out later this week. That's it for today. See you again tomorrow.