Economic experts have issued a stark warning that Donald Trump's threat to impose 10% tariffs on the United Kingdom and several European nations could plunge Britain into a recession and hasten the decline of the US dollar. The move is part of a dispute centred on the US President's demand for the "complete and total purchase" of Greenland.
Trump's Tariff Threat and Greenland Ultimatum
On Saturday, President Trump threatened to impose 10% tariffs on the UK, Denmark, Sweden, Germany, France, Norway, Finland, and the Netherlands by 1 February 2026. He stated these levies would then rise sharply to 25% by 1 June. The trigger for this aggressive trade policy is his administration's pursuit of Greenland, a vast Danish territory.
The White House has framed the acquisition as essential for US and global security, even suggesting a military takeover is possible. Just hours before the tariff announcement, Trump posted on Truth Social: “NATO has been telling Denmark, for 20 years, that ‘you have to get the Russian threat away from Greenland.’ Unfortunately, Denmark has been unable to do anything about it. Now it is time, and it will be done!!! President Donald J Trump."
UK Government and Market Reaction
Prime Minister Keir Starmer responded forcefully from Downing Street, labelling Trump's approach as "completely wrong." He argued that such protectionist measures would directly harm British businesses and the wider economy. "A trade war is in nobody's interests," Starmer asserted, signalling a firm stance against what he views as economic bullying.
Financial markets reacted with immediate volatility. Gold surged to $4,664.85 overnight, while silver reached a new all-time high of $93.33 in early Monday trading. Platinum prices also saw significant gains, indicating a flight to traditional safe-haven assets amid the geopolitical uncertainty.
Expert Warnings of Recession and Dollar Collapse
Financial planners and analysts have painted a grim picture of the potential fallout. Anita Wright, a Chartered Financial Planner at Ribble Wealth Management, explained that the US dollar is already under severe pressure. "A Dollar today measured by real money, which is gold, has lost 94% of its value in 26 years. And that pace is now accelerating," she stated.
Wright directly linked the instability to Trump's leadership, calling him "the most destructive US president in history" and accusing him of "megalomania" and capriciousness that contravenes international law.
Rohit Parmar-Mistry, Founder of Burton-on-Trent-based Pattrn Data, was even more blunt regarding the impact on Britain. He declared that the US is "dragging the UK into recession." He dismissed Trump's tactics as economic vandalism rather than strategic genius, warning that the US is devolving into a rogue state.
"Gold hitting $4,664 isn't a market triumph; it’s a vote of no confidence in global stability," Parmar-Mistry said. He cautioned investors to be wary of cryptocurrency markets, which he suggested could be manipulated by figures close to the administration. His final advice to the UK government was stark: "Appeasement doesn't work with bullies. If we don't draw a line now, we are complicit in our own economic decline."
