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Trump Announces 90-Day Pause on Tariffs

ElitePersonalFinance
Last Update: April 11, 2025 • Financial News •

On Wednesday afternoon, Trump announced a $98 tariff hike for most countries but took the wall up to China, raising its tariffs to 125% in response to its recent 84% declaration.

“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,” wrote Trump on Truth Social. Shortly, China will realize that the days of ripping off the U.S.A. and other Countries are no longer sustainable or acceptable.

“I have authorized a 90-day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately,” Trump wrote on Truth Social.

Although the 10% tariff rate on most imports is still in effect, most countries now have until July 8 to negotiate custom trade deals. The White House claims that more than 75 countries have called to discuss deals.

In response to the yariff news, US Stocks also rose sharply, with the NASDAQ climbing almost 9% and the S&P 500 up nearly 8%, along with an impressive 6% increase with the DOW Industrials. Gold prices also jumped to roughly $3,100 a troy ounce. In addition, major brokerages have also revised their forecasts. For example, Vanguard has cut its 2025 US GDP growth rate to less than 1%, below a prior estimate. Some more popular mainstream stocks like VSCO, AMD, and NVDA have already jumped 10%+ on the news.

China Ups Tariffs on the US to A Whopping 84%

In one of the biggest escalations of trade sanctions, China finally made a Wednesday push (just before the suspended tariff announcement on other countries) to impose new tariffs of 84% on All American Imports. This March, the latest exchange between the two warring countries sent fear throughout the global markets, increasing the chances of a recession even further, with no signs of any letter from the two powerhouses.

China’s Ministry of Commerce announced the director’s increase in raised tariffs from 34% to 84%, which will take effect on Thursday, April 10th.

“If the US insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end,” the Chinese Commerce Ministry said.

Apart from the increased tariff, China has also added 12 US-based companies to its export control list, which places new restrictions on dual-use items intended for civilian and military purposes. Shield AI and Sierra Nevada Corporation have also been barred from investing in China or importing or exporting entirely, a disastrous blow to both companies.

Where Do The Tariffs With China Stand Now?

As of now, President Trump has imposed a 125% tariff on all Chinese goods, calculated using the initial 50% levy, a 34% reciprocal fee, the original 20% duty, and now the additional penalty due to the perceived disrespect to the world markets per Trump. At a Tuesday night Republican fundraiser, President Trump continued to promote the tariffs, letting attending leaders know that many countries are reaching out to make a deal.

“I’m telling you, these countries are calling us up, kissing my ass,” said Trump at the event. “‘Please, please, sir, make a deal. I’ll do anything, sir!'” he continued.

White House Press Secretary Karoline Leavitt also continues to provide a rationale for tariffs, calling China’s decision to retaliate wrong.

“It was a mistake for China to retaliate. The president, when America is punched, he punches back harder,” said Leavitt. “That’s why there will be 104% tariffs going into effect on China tonight at midnight.”

Economic Fallout From China’s 84% Response

In response to China’s 84% tariff drop, Wall Street continued to suffer, with the Dow Jones Industrial Average dropping 254 points Wednesday morning on top of 5,000 points already wiped out. The S&P 500 also fell 0.3%.

“The market is telling us that even the faintest glimmer of positive trade news could send buyers rushing in,” said Carol Schleif, chief market strategist at BMO Private Wealth. “But the uncertainty is overwhelming. President Trump has rewritten the playbook, and investors are flying blind.”

“Valuations have reset, yes—but we don’t know if they’ve reset to the right levels. There’s no precedent for this.” continued Schleif.

What’s Up with the European Union?

This week, the European Union finally responded with its own tariffs, agreeing to impose a 25% tariff on all US motorcycles, poultry products, and fruit imports. These imports comprise rice, wood, clothing, barley, and hundreds of other products valued at more than 21 billion euros in 2024. This is in response to the 25% import tariffs on aluminum, steel, and automobiles, along with a broad 20% tariff on other goods, except for a few exceptions.

“These countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome,” said the European Commission.

Uncertain Road Ahead

Even with a 90-day pause on tariffs in most countries, economists and policymakers are mixed about the short—and long-term consequences. However, they continue to trade war with China as they are now isolated on the world front. This will pressure manufacturing sectors like electronics and automotive, which are bracing for price increases and potential layoffs. Higher grocery and retail prices are still in play.

However, there has also been a sense of optimism, especially with other agent countries like South Korea, Japan, and Indonesia, currently under negotiations.

Let’s see in the upcoming days and weeks whether China and the United States can agree upon a deal that makes sense to both parties. The global economy depends on it.

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