Trump announces 90-day pause on ‘reciprocal’ tariffs, sends markets rebounding

United States president Donald Trump announced a complete 90-day pause on all the “reciprocal” tariffs that went into effect at midnight on Apr. 9, with the exception of China.

This marked a stunning reversal that sent the stock market rebounding.

The president of the world's largest economy had previously insisted historically high tariffs were here to stay.

Another round of tariffs for China

While the rest of the world can breathe easy, China, the world’s second-largest economy, is facing another round of retaliatory tariffs.

Trump said they will be increased to 125 per cent from 104 per cent after China announced additional retaliatory tariffs against the U.S. earlier Wednesday.

However, the 10 per cent universal tariff on all imports going into the U.S. remained in effect.

What Trump said

“Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately,” Trump said in his Truth Social social media post.

“At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable,” he added.

Trump also told reporters after the announcement: “Nothing’s over yet, but we have a tremendous amount of spirit from other countries, including China. China wants to make a deal, they just don’t know how quite to go about it.”

China has vowed to fight the tariffs till the end.

Wall Street relieved

Wall Street breathed a sign of relief given the news that Trump was backing down.

Just after the opening bell, Trump posted on his Truth Social platform: “BE COOL!” and “This is a great time to buy!!!”

Stocks rallied sharply on the news in the afternoon in the U.S.: The Dow rebounded by more than 2,300 points, or 6.2 per cent, the S&P 500 went up 7 per cent, while the tech-heavy Nasdaq soared 8.5 per cent.

Investors appeared to have been bargain hunting as they snapped up stocks that were relatively cheap after the stock market sustained rout after rout over the past few days after Trump followed through with his tariffs announcement.

Top photo via Donald Trump Facebook