Washington, D.C. – April 9, 2025 – In a dramatic shift in U.S. trade policy, President Donald Trump announced today a 90-day pause on tariff hikes for dozens of countries, lowering their rates to a universal 10%, while simultaneously intensifying economic pressure on China by raising tariffs on its goods to an unprecedented 125%. The announcement, made via Truth Social and confirmed by the White House, marks a strategic pivot in Trump’s aggressive trade agenda, offering a temporary reprieve to many nations while doubling down on his confrontation with Beijing.
Trump has announced a 25% tariff on all foreign-made automobiles that will take effect at midnight
The decision comes less than 24 hours after steep reciprocal tariffs took effect on imports from over 50 nations and the European Union, a move that had sparked widespread market turmoil, threats of retaliation, and fears of a global recession. Trump’s initial tariff plan, unveiled on April 2 and dubbed “Liberation Day,” imposed a baseline 10% tariff on all U.S. imports, with higher rates—ranging from 11% to 50%—targeting specific countries deemed “worst offenders.” China had faced a 104% tariff as of midnight today, but Trump’s latest decree pushes that figure to 125%, effective immediately.
“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 wrote on Truth Social. “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.”
In contrast, Trump authorized a 90-day pause on higher tariffs for nations that have not retaliated against the U.S., lowering their rates to a “substantially reduced” 10%. He cited outreach from more than 75 countries eager to negotiate trade deals as the impetus for the pause. “These Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States,” Trump noted, framing the move as a reward for cooperation.
White House Press Secretary Karoline Leavitt defended the policy shift, stating, “When you punch at the United States of America, President Trump is going to punch back harder.” Treasury Secretary Scott Bessent, speaking to reporters outside the White House, emphasized that countries avoiding retaliation would be “rewarded” with the lower rate during the negotiation window. “Do not retaliate, and you will be rewarded,” Bessent said, adding that Trump plans to personally oversee “bespoke” trade talks with each nation.
Trump Imposes 104% Tariffs on China, Escalating Trade War Tensions
The announcement triggered an immediate surge in U.S. stock markets, with the Nasdaq 100 climbing 8% and the S&P 500 recovering some of the $5.8 trillion in value lost since the tariff rollout began. Analysts attribute the rally to relief over the pause, though uncertainty lingers about the long-term economic fallout, particularly with China.
Beijing swiftly condemned the 125% tariff hike, having already imposed retaliatory duties of 84% on U.S. imports earlier today in response to the initial 104% rate. Chinese officials signaled they are prepared for a prolonged trade war, with state media accusing the U.S. of “economic bullying.” Meanwhile, the European Union, which had approved retaliatory tariffs ranging from 10% to 25% on $24 billion in U.S. goods, has yet to clarify how the 90-day pause will affect its plans.
Economists warn that the escalating U.S.-China trade conflict could raise consumer prices and disrupt global supply chains. The Tax Foundation estimates Trump’s tariffs will increase federal revenues by $206.6 billion in 2025 alone, marking the largest tax hike since 1982. Critics, including Democratic Rep. Brad Schneider, lambasted the policy during a Ways and Means Committee hearing, questioning its coherence. “What’s the president thinking? Did you expect… a self-induced bear market?” Schneider asked U.S. Trade Representative Jamieson Greer.
Business leaders expressed mixed reactions. Delta Air Lines CEO Ed Bastian noted “strong demand” despite the uncertainty, while automakers like Stellantis and General Motors announced layoffs and production shifts in response to earlier tariff pressures. Some, however, see opportunity: Trump urged companies to relocate to the U.S., promising “zero tariffs” and rapid approvals for those who do.
As the 90-day clock begins, the world watches to see if Trump’s gamble—easing tensions with some while escalating with China—will reshape global trade or deepen economic divides. For now, the pause offers a brief respite, but the specter of a full-scale trade war looms large.
