Trump Pauses Higher Tariffs for 90 Days While Increasing China Tariffs to 125%

President Trump has announced a 90-day pause on heightened tariffs for most trading partners while imposing a 125% tariff on China. This announcement follows concerns over a potential global recession. The pause will see affected countries face a reduced tariff of 10%, contrasting with existing higher rates for certain regions.

President Donald Trump announced a 90-day pause on higher tariffs for over 75 countries, with the notable exception of China, which will see its tariffs increased to 125%. This decision followed global concerns regarding a potential recession and significant declines in stock markets after the initial “Liberation Day” tariff announcements on April 2. Following Trump’s announcement, the S&P 500 index rose by 9.5%, reflecting a positive reaction from global markets.

In a statement on his Truth Social platform, President Trump explained that the 90-day reprieve applies to countries that have not retaliated against U.S. tariffs. These countries will now face a reduced tariff of 10%, which is significantly lower than the previous rates imposed on the EU, Japan, and South Korea, which were set at 20%, 24%, and 25% respectively. The U.K. is set to endure a 10% tariff under the new structure.

Moreover, the increased tariff on imports from China takes effect immediately and adds to previously established levies. Trump remarked that he anticipates that China will eventually recognize the unsustainability of its previously exploitative trade practices. The U.S. aims to maintain significant pressure on China amidst ongoing trade negotiations.

The key elements of Trump’s tariff adjustment include a 90-day suspension of new higher rates for 57 trading partners—particularly impacting the EU, Japan, and South Korea—and maintaining a 10% baseline duty. However, Canada and Mexico will retain their 25% tariffs on certain imports unless they comply with the U.S.-Mexico-Canada Agreement rules. Additionally, the existing tariffs on steel, aluminum, and automobiles remain in effect.

The White House clarified that Trump’s tariff pause would not alter the 25% tariffs on specific imports from Mexico and Canada, as these countries were excluded from the earlier announcements. Conversely, China had raised its own tariffs on U.S. goods to 84%, exacerbating the tensions further.

In response to concerns regarding market instability, Trump communicated on his Truth Social that consumers were becoming anxious. He expressed confidence that China desires an agreement, although they have yet to figure out a suitable approach. White House spokesperson Karoline Leavitt described Trump’s approach as a strategic move aimed at maximizing his negotiation leverage.

In conclusion, President Trump’s recent tariff measures illustrate a complex trade strategy that seeks to balance addressing U.S. trade complaints against China while providing temporary relief to other international partners. The ongoing negotiations and tariff strategies will significantly influence the global economic landscape in the months to come.

In summary, President Trump has enacted a temporary 90-day pause on higher tariffs for numerous countries while escalating tariffs on China to 125%. This decision is indicative of a strategic maneuver aimed at stabilizing economic uncertainty amidst fears of a global recession. The efficacy and repercussions of these tariffs will become clearer as negotiations proceed and global market reactions unfold.

Original Source: news.sky.com