The “sell America trade” has become a common expression among traders and investment notes, explaining day-to-day price movements in global markets. This phenomenon emerged after US President Donald Trump unveiled his new tariff regime on April 2, sparking market turmoil.
For decades, the US was seen as a reliable place to invest, but the recent tariff policy shift has shaken investor confidence. Many investors have sold US assets and shifted their money to more stable markets elsewhere. Currency strategist Peter Dragicevich says investor confidence in the US has been “shaken” by the changing policy.
The impact is far-reaching, with US government bonds, the US dollar, and American equities all experiencing significant losses. This unusual combination of market moves suggests a widespread rejection of US assets. Ryan Swift, a US bond strategist, warns that the trade war could push the US economy into recession within the next few months.
As a result, Australian markets are reacting to the shift in global investment priorities. The Australian dollar has surged against the weak US dollar, and other currencies such as the euro and pound have outperformed the US dollar. However, some experts caution that this may be a short-term response to the volatility.
While the US still attracts significant investment, the recent tariff policy may have already caused industries to rethink their trading relationships with the US. This could lead to a long-term drag on US wealth as sectors develop their own capabilities or find alternative markets for products. Economists also note an early decoupling of the US and Australian markets due to Trump’s tariffs.
Despite this, some experts believe Australia may avoid a recession even if the US falls into one. Shane Oliver, chief economist at AMP, says that while the US is most at risk from the trade war, other countries are only seeing their trade with the US impacted.
Source: https://www.theguardian.com/australia-news/2025/apr/21/sell-america-trade-investors-trump-tariffs-stock-market-shares-dollar-explainer