Why Trump Suspended Tariffs for 90 Days for All Countries Except China

Last Updated Apr - 10 - 2025, 04:31 PM | Source : Fela News

Donald Trump declared a 90-day suspension of tariffs for every country except China, which will instead face an immediate tariff hike of 125 percent.

On Wednesday, U.S. President Donald Trump announced a 90-day suspension of his broad tariff policy for all countries except China—a decision that seemed unlikely just a day earlier. Trump, who introduced the tariffs to address what he claimed was a trade imbalance with the U.S., said that more than 75 countries had chosen to negotiate and refrain from retaliating, prompting the temporary pause. During this period, a reduced reciprocal tariff of 10 percent would apply.

In a post on Truth Social, Trump stated that due to what he described as China’s ongoing disregard for global markets, he was immediately raising U.S. tariffs on Chinese goods to 125 percent. He hoped China would eventually realize it could no longer exploit the U.S. and other nations. Trump also suggested that while China—and President Xi Jinping in particular—wants to strike a deal, they’re unsure how to proceed but will eventually figure it out.

Why Did Trump Pause the Tariffs?

Although Democratic lawmakers and business leaders had been urging Trump for days to stop the tariffs over fears of sparking a major trade war, causing global market turmoil, and possibly triggering a worldwide recession, he initially refused, insisting that his policies would not change. Even after the tariffs were enforced, pressure from his allies didn’t sway him.

What eventually prompted the 90-day pause was growing concern within the U.S. Treasury Department, particularly regarding instability in the bond market. Treasury Secretary Scott Bessent reportedly raised the issue with Trump, supported by briefings from White House economic advisors on the rapid selloff in U.S. Treasury bonds.

Trump’s remarks following the announcement suggested the decision was more spontaneous than strategic. He acknowledged concerns about the bond market, calling it “tricky” but also “beautiful,” and admitted that the pause was “written from the heart.” He noted that some people were “getting a little scared” and emphasized the importance of being flexible.

Stock Market Response

The announcement sent Wall Street soaring. The Dow Jones surged by roughly 2,500 points, ending the day with nearly an eight percent gain. The Nasdaq jumped 12.2 percent, marking its best performance in 24 years, while the S&P 500 climbed six percent to close at 5,281.44. Oil prices rose more than four percent, and the U.S. dollar also strengthened.

Impact on India

Since Trump had previously imposed a 26 percent reciprocal tariff on Indian imports, Indian markets have been struggling. The 90-day pause is expected to provide relief and give India more time to finalize a trade deal with the U.S.

India’s Ministry of External Affairs spokesperson, Randhir Jaiswal, confirmed that discussions between the two countries' trade teams are ongoing to reach a mutually beneficial agreement. He emphasized the strong trade, investment, and economic ties between India and the U.S. and expressed optimism that the bilateral trade deal would be concluded soon.

In contrast, Trump announced an immediate tariff hike on China, raising it from the previously set 104 percent to 125 percent.