The term 'TACO trade' was coined by Financial Times columnist Robert Armstrong, representing the pattern of President Trump announcing exorbitant tariffs only to later retract them, leading to market recoveries. Initially used in finance circles, the term gained mainstream traction when the New York Times highlighted traders exploiting this trend. The phrase has even prompted a response from Trump himself, reflecting its reach beyond finance. As traders capitalize on Trump's 'chickening out', the TACO trade illustrates a unique intersection of politics and market behavior.
The TACO trade, which stands for 'Trump Always Chickens Out', reflects how President Trump's tariff announcements led to market volatility followed by recovery once he's backed down.
Robert Armstrong's TACO trade coined a phrase that encapsulates Trump's pattern of dramatic tariff threats followed by easing tensions, capitalized on by savvy traders.
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