President Donald Trump is backing down on his tariffs and putting levies on most countries on a 90-day freeze amid the global market crisis, he said Wednesday.
But after announcing the astonishing about-face, the president also said he is raising the stakes in his trade war with Bejing by ramping up China’s tariffs to a whopping 125 percent.
There was an immediate reaction on Wall Street. The Dow Jones Industrial Average shot up by 2,500 points after Trump revealed he was making the pause. The S&P soared 7.6 percent, the biggest intraday move for five years, and the Nasdaq jumped by 9.4 percent.
Trillions of dollars boosted the value of whiplashed U.S. stocks, pouring cash back into Americans’ depleted 401(K)s.
Earlier this week, the president insisted he wasn’t considering any pause in his tariffs, which went into force at midnight on Wednesday.
But in a Truth Social post on Wednesday afternoon, Trump called a pause on his game of brinkmanship with the rest of the world. He announced a reprieve of 90 days on his higher rates of tariffs for most countries because 75 nations had contacted the White House to negotiate the sliding scale of retaliatory levies.
The president was facing massive pressure from his donors, GOP lawmakers, world leaders, and from some of his own advisers to play for time to give the markets time to recover. The threat to the bond market—usually a safe haven in times of economic turmoil—spooked some White House officials who worried about the economic volatility.
“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,” the president posted.
“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.”
However, he said other nations would only be charged 10 percent in import levies for 90 days.
“Conversely, and based on the fact that more than 75 Countries have called Representatives of the United States, including the Departments of Commerce, Treasury, and the USTR, to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation, and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter!”
While the announcement ramped up the trade war with China, it was met with relief by the money markets after days of volatility since Trump announced the tariffs last week.
White House press secretary Karoline Leavitt insisted that Trump was playing the “long game” after years of America being “ripped off.”
She attacked the media for “missing the art of the deal” with criticism of the tariffs. “You clearly failed to see what President Trump is doing here,” she said.
Standing next to Leavitt outside the West Wing, Treasury Secretary Scott Bessent claimed: “This was his strategy all along.
“It took great courage for him to stay the course until this moment,” he added.
Early countries that reached out to the Trump administration, including South Korea, Japan, and Vietnam, are included in the pause.
Commerce Secretary Howard Lutnick called Trump’s announcement, “one of the most extraordinary Truth posts of his presidency.”
Lutnick was reportedly one of Trump’s inner circle counseling the president to stay firm on the levies, but he claimed he sat next to Trump with Bessent as he drafted the message.
Trump will discuss his next moves at a Cabinet meeting on Thursday.
The post Trump Cries Uncle on Tariff Crisis After Market Collapse appeared first on The Daily Beast.
