US President Donald Trump announced a temporary pause on the majority of his “reciprocal” tariffs, explaining the decision was due to market reactions, with people “getting yippy” and “a little bit afraid.”
The President indicated that tariffs would be lowered to 10 percent on imports from trading partners that had not imposed retaliatory tariffs on American goods. This adjustment applies to approximately 75 countries currently in discussions with the administration to reach new trade agreements, including India, which is negotiating a Bilateral Trade Agreement.
China emerged as the most notable focus of Trump’s revised strategy. Trump had previously raised tariffs on Chinese goods to 125 percent in response to China’s retaliatory tariff of 84 percent on American exports.
Trump communicated this shift via a post on Truth Social, coinciding with a market rebound after a period of turmoil driven by trade tensions. US markets, particularly the tech-heavy Nasdaq, surged to a two-decade high following the announcement.
Explaining his decision, Trump remarked, “I thought that people were jumping a little bit out of line,” referring to market volatility and reactions from US officials. “They were getting yippie, you know, they were getting a little bit, a little bit afraid,” he continued, emphasizing the importance of flexibility in such negotiations.
While Trump had initially signaled that the reciprocal tariffs were non-negotiable, he later clarified that he was open to adjustments. He stated on Truth Social:
“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 percent, effective immediately.”
Simultaneously, Trump noted that representatives from over 75 countries, including various US government departments, had contacted the administration to discuss resolving trade barriers and disputes. He emphasized that countries not imposing retaliatory tariffs would benefit from the reduced 10 percent rate during this period, provided they continue constructive negotiations.
The move came amid escalating pressure from influential figures like Elon Musk, as well as financial leaders such as Bill Ackman, who publicly called for a pause on tariff hikes due to market instability.
Following Trump’s announcement, markets saw an immediate uplift. Trump encouraged optimism, posting on Truth Social:
“Be cool! Everything is going to work out well,” expressing confidence that the US economy would emerge stronger.
Shortly after, he issued an advisory for investors, enthusiastically stating:
“This is a great time to buy.”
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