On Wednesday, President Trump announced a significant shift in his tariff strategy, temporarily suspending a planned 10% tariff on several nations while maintaining an unprecedented increase for China. This decision comes after days of fluctuating stock market performances, which resulted in a considerable $7 trillion loss in market value.

Details of the Tariff Adjustments

During a social media update, Trump articulated his approach to tariffs. He noted that while the universal 10% tariff on most countries will be paused, China will face heightened duties, bringing their tariff rate to an alarming 125%. This increase follows China’s equivalent retaliatory measures against previous tariff hikes imposed by the U.S.

Market Reaction

The announcement triggered a dramatic rebound in the stock market, marking the most substantial rally in five years. The Dow Jones Industrial Average climbed more than 2,600 points, while the Standard & Poor’s 500 index rose by over 7%. Notably, the Nasdaq index surged by 10% within an hour of Trump’s declaration.

Trump’s Statement on Trade Negotiations

In his post on Truth Social, Trump emphasized the United States’ stance on trade negotiations with China. “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,” he stated, expressing hope that China would recognize the unsustainability of its previous practices.

International Responses and Negotiations

Additionally, Trump mentioned that over 75 countries have reached out to his administration to discuss various trade-related issues, leading him to authorize a “90-day pause” on tariffs with substantially lower reciprocal rates set at 10%. This, he noted, is part of a broader strategy to leverage negotiation and maintain beneficial trade relations.

Government Officials’ Remarks

Treasury Secretary Scott Bessent addressed the media, explaining that the president’s decision to pause certain tariffs was driven by a lack of retaliatory responses from many nations. “President Trump created maximum negotiating leverage for himself,” Bessent remarked, highlighting the wave of interest from allied countries wishing to negotiate in good faith.

Addressing Media Concerns

As speculation mounted over whether Trump’s retreat was influenced by market pressures, White House Press Secretary Karoline Leavitt challenged this narrative, defending the president’s tactics. “Many of you in the media clearly missed the art of the deal,” she asserted, implying that the adjustments were part of a strategic negotiation process rather than a capitulation under financial scrutiny.

This developing story will continue to be updated as further information becomes available.