In the face of increasing geopolitical unpredictability and escalating volatility in US assets, foreign investors are increasingly turning to Singapore as a financial haven.
Since the start of 2025, Singaporean stocks have produced a 13% total return, more than doubling the MSCI All Country World Index’s 6% gain. This indicates that capital is pouring into Singapore’s safe markets as US policy turbulence and legal uncertainties increase.
The “Taco Trade” Effect: Trump’s Tariff Reversals Fuel Market Swings
Analysts at Morgan Stanley blame the trend on recurrent market surges brought on by the infamous “Taco trade.” Robert Armstrong, a columnist for the Financial Times, coined the phrase “Trump always chickens out” on tariffs. President Trump’s recent decision to remove tariffs on imports from China and Europe has resulted in notable increases in stock prices.
Trump’s reversal of a scheduled tariff hike following market turbulence in April marked the start of the trend, which continued into May with a last-minute halt on 50% duties on European imports and a 90-day postponement on U.S.-China tariff decisions.
Market fatigue is still increasing, though. Bloomberg reports that by late May, the S&P 500’s sensitivity to tariff announcements had decreased from 80% in early April to just over 30%. In contrast to the US, which Moody’s downgraded on May 16, Singapore maintains its AAA credit rating from all three major agencies, making it a desirable travel destination.
Gold Rush: Wealthy Investors Bet on Physical Bullion
The ultra-wealthy are increasingly keeping actual gold in high-security vaults close to Changi, which enhances Singapore’s reputation as a secure haven. One city-state’s most well-known precious metals facility, The Reserve, reported a 200% increase in bar sales and an 88% increase in storage orders year over year, primarily from foreign customers.
Additionally, investors are turning away from the US dollar and conventional paper gold assets in favour of actual bullion and currencies linked to more stable economies. Investor caution is being exacerbated by the ongoing legal dispute between the Trump administration and the US Court of International Trade regarding the legitimacy of broad import tariffs.
If you have any questions, please do not hesitate to contact us.
Giorgi Kurtsikidze
https://gerai.co.ukMy mission is to provide client-focused legal solutions and services through flexible, value-driven approaches by leveraging technologies to anticipate the needs of those existing and potential clients I serve in a manner that adheres to the highest standards of excellence and integrity in the field of Business Law.