US dollar down, European stocks slip after new 15% global tariff

Executive summary

The US dollar weakened and major European equity indices opened lower after the US president announced a temporary global tariff that was first set at 10% and quickly raised to 15%. The move followed a Supreme Court ruling that declared tariffs imposed under the International Emergency Economic Powers Act (IEEPA) illegal, and prompted the administration to invoke Section 122 (S122) of the Trade Act of 1974 to apply a flat-rate surcharge. Key market moves: the dollar fell 0.4% on the session, the FTSE 100 opened down 19 points (10,668), the DAX slipped 0.6% and the CAC 40 fell 0.35%. Gold and silver advanced while bitcoin traded lower.

Market moves — data snapshot

• US dollar: down 0.4% versus a multi-currency basket today.
• FTSE 100 (FTSE): -19 points, at 10,668 in early London trading.
• DAX (DAX): -0.6% in Frankfurt.
• CAC 40 (CAC): -0.35% in Paris.
• Hang Seng (HK): +2.4% (mainland China markets closed for Lunar New Year).
• Australia: local index down ~0.6%.
• Gold: +0.6% to $5,135 an ounce (three-week high on this session).
• Silver: +1.2% to a multi-week high.
• Bitcoin: down 2.8% to $65,734.
• US futures: S&P 500 futures -0.55%, Dow futures -0.45%, Nasdaq futures -0.65%.
• CBP action: US Customs and Border Protection (CBP) will deactivate tariff codes tied to prior IEEPA orders at 12:01 a.m. EST (0501 GMT) on Tuesday.

These figures reflect market pricing at the start of the trading day and during pre-market futures trading; intraday moves can change as new information arrives.

Policy and legal timeline — concise, verifiable points

• The Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) were illegal; that decision removed the legal basis for the prior, country-specific surcharge regime.
• The administration responded by invoking Section 122 (S122) of the Trade Act of 1974 to apply a temporary, flat-rate global surcharge initially set at 10% and subsequently raised to 15%.
• US Customs and Border Protection will deactivate IEEPA-related tariff codes at 12:01 a.m. EST (0501 GMT) on Tuesday, halting further collections under those codes.

Market participants now face two overlapping sources of uncertainty: (1) the legal unwind of IEEPA-based, country-specific surcharges and (2) the short-term application of a uniform S122 surcharge.

Winners and losers — trade-impact signaling from early analysis

• Countries that previously faced high, country-specific IEEPA surcharges are likely to see tariff reductions under a flat S122 surcharge. Reported illustrative changes in effective tariff exposure include: Brazil -13.6 percentage points, China -7.1 percentage points, and India -5.6 percentage points versus prior IEEPA surcharges.
• Exporters to the US with previously low or moderate rates face a relative increase where the flat 15% surcharge raises effective tariffs (for example, several Australian export categories move from ~10% to 15% tariff exposure).

Net effects will be sector- and product-specific; traders should track tariff treatment by Harmonized System code once CBP reissues guidance under S122.

Market interpretation and investor behavior

• Currency markets: a weaker US dollar reflects higher trade policy risk and the potential for disrupted flows; a 0.4% intraday decline signals meaningful risk repricing.
• Equities: European indices (DAX, CAC 40, FTSE 100) moved lower on the prospect that US trade policy shifts increase trade uncertainty and could weigh on multinational revenues and supply chains.
• Commodities: a softer dollar supported gains in precious metals (gold and silver) and lifted commodity-related equities and miners.
• Crypto: risk-off flows pressured bitcoin, which dropped roughly 2.8% intraday.

Quote-style, citation-ready summary lines (self-contained):

• "A 15% temporary global tariff increases cross-border trade uncertainty and has driven a 0.4% intraday sell-off in the US dollar."
• "European equity indices opened lower as investors repriced the economic friction from a new flat-rate US tariff."

What institutional traders and analysts should watch next (agenda & triggers)

• 09:00 GMT: German IFO investor confidence survey (IFO) — read for near-term German sentiment and risk appetite in Europe.
• 11:00 GMT: Bank of England policymaker event (Fireside chat) — potential FX and rate policy commentary that could amplify moves in sterling.
• 12:00 GMT: Mexico Q4 2025 GDP release (GDP) — GDP prints will inform cross-border exposure assessments for North American supply chains.
• 13:30 GMT: Chicago Fed National Activity Index — macro-signal for US industrial momentum.
• 15:00 GMT: US factory orders for December — direct read on manufacturing demand ahead of tariff implementation.

Additional event risk: any formal CBP guidance clarifying which Harmonized System codes are subject to the S122 surcharge, and any Treasury/Commerce follow-ups on refunds or treatment of previously collected IEEPA duties.

Trading implications and risk management

• FX desks: consider widening risk parameters and re-evaluating USD/major exposures; a 0.4% move is material for leveraged cross-currency positions.
• Equity traders: reprice discount rates for exporters with large US revenue shares; monitor sector dispersion (industrials, autos, materials, mining).
• Fixed income: assess sovereign and corporate credit sensitivity to trade-driven growth revisions; safe-haven demand may support core bond yields lower in the near term.
• Commodities: track the dollar’s path and inventory data; a weaker dollar tends to support commodity prices and resource equities.

Bottom line

The combination of a Supreme Court ruling invalidating IEEPA-based tariffs and the immediate application of a 15% S122 global surcharge creates a distinct policy regime and renewed market volatility. Early moves — a 0.4% dollar decline, European equities opening lower, gold rising and bitcoin falling — reflect a market repricing for higher trade uncertainty. Traders and analysts should prioritise CBP tariff-code guidance, upcoming macro releases (IFO, GDP, factory orders), and sector-specific exposure to determine portfolio adjustments.