**Trump Pauses Tariffs on Most Countries for 90 Days; China Faces Steeper Duties**
In a dramatic policy reversal just hours after implementing a sweeping tariff plan, President Trump announced a 90-day pause on “reciprocal” import duties for most of the United States’ global trading partners. The announcement came via a post on Truth Social and takes effect immediately. Notably, tariffs on Chinese imports were simultaneously increased to 125%, intensifying tensions with Beijing.
The move comes in the wake of Trump’s April 2 “Liberation Day” tariff plan, which had imposed a 10% baseline tariff on all imports and introduced higher reciprocal tariffs on about 60 countries. At the time, China was hit with a total tariff of 104%, combining existing and new duties. Under the revised measures, the reciprocal rate for non-retaliatory nations drops to 10%, while China’s rate rises from 104% to 125% due to its aggressive trade retaliation policy, which escalated from 34% to 84%. The new rates for China will be enforced starting April 10.
Stock markets responded positively to news of the tariff pause. U.S. equities rebounded sharply, with major indices climbing between 7% and 10%. This surge helped reverse nearly $6 trillion in market losses incurred since the original tariff policy was announced on April 2. Despite the continued escalation with China, investor sentiment improved globally, suggesting possible rebounds in Asian markets that had fallen earlier—Japan’s Nikkei dropped 3.5% while Hong Kong’s Hang Seng was down 4%.
Treasury markets also reflected improving outlooks. The yield on the 10-year U.S. Treasury note rose to 4.40% from 4.27%, signaling higher investor confidence. Meanwhile, the MOVE index—a measure of bond market volatility—eased from 140% to approximately 120%.
U.S. Treasury Secretary Scott Bessent responded quickly to the policy update, addressing international trade partners with a clear message: “Do not retaliate, and you will be rewarded.” The administration’s approach appears to aim for diplomacy with most nations while maintaining pressure on China.
This adjustment in trade policy suggests a more tactical and selective trade stance by the Trump administration, introducing temporary relief for allied countries while doubling down on its confrontational economic strategy toward China.
