LIVE: EU to put tariff retaliation on hold for 90 days to match Trump's pause
European Commission chief Ursula von der Leyen earlier described the halt on reciprocal tariffs as “an important step towards stabilising the global economy"
Facing a global market meltdown, President Donald Trump on Wednesday (April 9) abruptly backed down on his tariffs on most nations for 90 days, but raised the tax rate on Chinese imports to 125 per cent.
It was seemingly an attempt to narrow what had been an unprecedented trade war between the US and most of the world to a showdown between the US and China.
90-day pause
The S&P 500 stock index jumped nearly 7 per cent after the announcement, but the precise details of Trump's plans to ease tariffs on non-China trade partners were not immediately clear.
Also read: Trump-speak: 9 bizarre things the US President said in the past week
Trump posted on Truth Social that because “more than 75 Countries” had reached out to the US government for trade talks and have not retaliated in meaningful way “I have authorised a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10 per cent, also effective immediately.”
The 10 per cent tariff was the baseline rate for most nations that went into effect on Saturday. It's meaningfully lower than the 20 per cent tariff that Trump had set for goods from the European Union, 24 per cent on imports from Japan and 25 per cent on products from South Korea.
Still, 10 per cent would represent an increase in the tariffs previously charged by the US government.
Market pressure
The announcement came after the global economy appeared to be in open rebellion against Trump's tariffs as they took effect Wednesday, a signal that the US president was not immune from market pressures.
Business executives were warning of a potential recession caused by his policies, some of the top US trading partners are retaliating with their own import taxes, and the stock market is quivering after days of decline.
Also read: China urges India to unite against Trump tariff ‘abuse’
White House press secretary Karoline Leavitt said the walk back was part of some grand negotiating strategy by Trump.
“President Trump created maximum negotiating leverage for himself,” she said, adding that the news media "clearly failed to see what President Trump is doing here. You tried to say that the rest of the world would be moved closer to China, when in fact, we've seen the opposite effect the entire world is calling the United States of America, not China, because they need our markets.” But market pressures had been building for weeks ahead of Trump's move.
Worried investors
Particularly worrisome was that US government debt had lost some of its lustre with investors, who usually treat Treasury notes as a haven when there's economic turbulence.
Government bond prices had been falling, pushing up the interest rate on the 10-year US Treasury note to 4.45 per cent. That rate eased after Trump's reversal.
Watch: Stock Market Mayhem: Is Your Money Safe? Buy, Hold or Sell
Gennadiy Goldberg, head of US rates strategy at TD Securities, said before the announcement that markets wanted to see a truce in the trade disputes.
“Markets more broadly, not just the Treasury market, are looking for signs that a trade de-escalation is coming," he said. "Absent any de-escalation, it's going to be difficult for markets to stabilise.” John Canavan, lead analyst at the consultancy Oxford Economics, noted that while Trump said he changed course due to possible negotiations, he had previously indicated that the tariffs would stay in place.
“There have been very mixed messages on whether there would be negotiations," Canavan said. "Given what's been going on with the markets, he realised the safest thing to do is negotiate and put things on pause.” Presidents often receive undue credit or blame for the state of the US economy as their time in the White House is subject to financial and geopolitical forces beyond their direct control.
What's not yet known is what Trump does with the rest of his tariff agenda. In a Tuesday night speech, he said taxes on imported drugs would happen soon.
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Live Updates
- 10 April 2025 2:52 PM GMT
Trump suggests his budget bill is making progress in Congress
US President Donald Trump says his proposed legislation to extend first-term tax cuts is “coming along really well,” despite facing pushback from some Republicans in the House.
The Senate has approved the bill, but a few right-wing lawmakers in the House have criticised it for not slashing government spending enough.
“Great News! ‘The Big, Beautiful Bill’ is coming along really well. Republicans are working together nicely. Biggest Tax Cuts in USA History!!! Getting close,” Trump wrote in a social media post.
- 10 April 2025 12:24 PM GMT
CITI urges govt to consider Textiles Exports Protection Scheme to mitigate costs of US tariffs
The Confederation of Indian Textile Industry (CITI) on Thursday urged the government to consider introducing an interim Textile Exports Protection Scheme to mitigate the burden of additional tariff costs faced by exporters, terming the 90-day pause on reciprocal tariffs announced by the Trump administration as a stopgap measure.
The textiles industry body stressed that the government must intensify its engagement with US counterparts to arrive at a more sustainable and mutually beneficial solution.
The US is the largest destination for Indian textiles and apparel exports.
US President Donald Trump on Wednesday deferred by 90 days the reciprocal tariffs that were scheduled to come into effect from April 9 on 75 countries with which the US has a trade imbalance.
The US, however, raised the tax rate on Chinese imports to 125 per cent "effective immediately".
However, the higher 10 per cent tariff, which was effective from April 5, will continue. In the case of India, the additional duty of 16 per cent has been put on hold for 90 days.
"The temporary relief will bring short-term respite to Indian textile and apparel (T&A) exporters, who were bracing for higher tariff barriers. However, this measure is only a stopgap. It is crucial that the government intensifies its engagement with US counterparts to arrive at a more sustainable and mutually beneficial solution," CITI Chairman Rakesh Mehra stated.
- 10 April 2025 11:59 AM GMT
China slashes US film imports over tariffs, says open to fair dialogue
As US President Donald Trump hiked tariffs against China to 125 per cent while pausing levies on most countries, Beijing in retaliation has reduced the import of US films and called on Washington to return to fair dialogue without threats.
Meanwhile, a rare survey of Chinese public opinion highlighted growing concerns of the Chinese public over the impact of the trade war on their country.The state-run China Film Administration said, “The US government’s erroneous practice of imposing excessive tariffs on China is likely to further diminish the Chinese audience’s favourable perception of American films.
“We will adhere to market principles, respect audience choices and moderately reduce the import volume of American films,” it said.
Separately, China's Commerce Ministry spokesperson He Yongqian told a press briefing on Thursday that while Beijing remains open to talks, any dialogue must be based on mutual respect and conducted on equal footing.
If the US is bent on waging a trade war, China will fight to the end, He said.
"Pressure, threats and blackmail are not the right way to deal with China. We hope that the two countries will meet each other halfway and work towards resolving differences through dialogue and consultation, guided by the principles of mutual respect, peaceful coexistence and win-win cooperation," He added.
Trump’s tariffs will affect over USD 438 billion in Chinese exports, while China has imposed tariffs on 84 per cent of USD 143 billion in US exports.
Earlier Chinese Foreign Ministry spokesperson Li Jian, while answering questions on Trump hiking the tariffs against China and whether Beijing will retaliate, said Beijing will not sit idle and won’t let Washington use tariffs as a weapon.
- 10 April 2025 11:56 AM GMT
Benchmark indices may see positive trading on Friday after US' 90-day tariff pause
Domestic benchmark equity indices may see a positive trading sentiment on Friday thanks to a spectacular rally in world markets after the US President Donald Trump announced to put tariff hikes on hold for 90 days, excluding China from the reprieve.
Indian stock markets were closed on Thursday for Shri Mahavir Jayanti.
Trump has declared a three-month pause on reciprocal tariffs on non-retaliating countries marking a rather unexpected U-turn after record high levies he imposed led to global stock market meltdown.
World markets were in a euphoric state following Trump's decision to put his sharp tariff hikes on hold for 90 days.
In Asian markets, Tokyo's Nikkei 225 index jumped 9.13 per cent, South Korea's Kospi surged 6.60 per cent. Hong Kong's Hang Seng went up 2.06 per cent and Shanghai SSE Composite index climbed 1.16 per cent.
European markets also rejoiced the announcement and were trading sharply higher.
US markets were on fire on Wednesday, ending with stupendous gains. The Nasdaq composite surged 12.16 per cent, S&P 500 zoomed 9.52 per cent and Dow Jones Industrial Average jumped 7.87 per cent.
"The Trump announcement announcing a 90-day pause is a welcome move which reflected positively in other Asian markets today with a positive 5-8 per cent gap-up. Indian markets too would see a similar kind of 3-5 per cent gap-up opening on Friday, as we believe any negative action against China with a tariff increasing to 125 per cent would eventually benefit India the most," Rakeshh Mehta, Chairman, Mehta Equities-Mehta Group, said. PTI
- 10 April 2025 11:14 AM GMT
Global shares jump following historic gains on Wall St
World markets soared on Thursday, with Japan's benchmark jumping more than 9% as investors welcomed US President Donald Trump's decision to put his latest tariff hikes on hold for 90 days, though he excluded China from the reprieve.
In early trading, Germany's DAX initially gained more than 8%. By mid-morning, they were up 5.3% at 20,720.86, while France's CAC 40 in Paris gained 5% to 7,204.23. Britain's FTSE 100 surged 4.0% to 7,983.37.
Chinese shares saw more moderate gains, given yet another jump in the tariffs each side is imposing on each others' exports.
The future for the S&P 500 was down 2.1% while the contract for the Dow Jones Industrial Average dropped 1.6%.
Analysts had expected the global comeback given that US stocks had one of their best days in history on Wednesday as investors registered their relief over Trump's decision.
“Everything is still very volatile, because with Donald Trump, you don't know what to expect. This is really big uncertainty in the market. The threat of recession has not faded," said Francis Lun, chief executive of Geo Securities.
In Asia, Japan's benchmark Nikkei 225 jumped 9.1% to finish at 34,609.00, zooming upward as soon as trading began.
Australia's S&P/ASX 200 soared 4.5% to 7,709.60. South Korea's Kospi gained 6.6% to 2,445.06. Hong Kong's Hang Seng added 2.1% to 20,681.78. The Shanghai Composite rose 1.2% to 3,223.64.
Investors went “from fear to euphoria,” Stephen Innes, managing partner at SPI Asset Management, said in a commentary.
- 10 April 2025 11:12 AM GMT
Tariff war: Aluminium producers closely monitoring dynamic situation, say analysts
With the US putting a 90-day pause on implementation of reciprocal tariffs on most nations including India, aluminium producers are closely monitoring the dynamic situation with respect to changes in trade flows, industry analysts said on Thursday.
India's steel exports to the US is not more than two per cent of its primary aluminium production or four per cent of its total output shipments, they said.
However, there is a need to keep a close watch on protecting the domestic market from possible dumping from other nations such as China and the Middle East, they added.
Amid a global market meltdown, US President Donald Trump on Wednesday abruptly backed down on his tariffs on most nations for 90 days, but raised the tax rate on Chinese imports to 125 per cent.
However, the 10 per cent tariff that came to effect on April 5 will be there. The US, while announcing a sweeping reciprocal tariffs on most of its trade partners on April 2, had imposed additional import duty of 26 per cent on India.
The aluminium industry is not covered under the reciprocal tariff order, but the sector has already been facing an additional 25 per cent levies announced by the US administration in March this year.
B K Bhatia, additional secretary general of FIMI (Federation of Indian Mineral Industries), is of the view that tariff pause is not going to have any benefit for aluminium industry "as tariff imposed at 25 per cent earlier on aluminium and steel remains unchanged and was not part of reciprocal tariff".
During the financial year 2023-24, India's total exports of minerals and non-ferrous metals (other than steel) stood at USD 17,474 million. Out of this, exports to USA accounted for USD 1,291 million which is about 7.4 per cent of the total exports of this sector.
The major share of exports is accounted by aluminium and its articles valuing about USD 946 million, followed by copper and articles worth USD 292 million and baryte to the tune of USD 78 million. PTI
- 10 April 2025 11:11 AM GMT
EU will put tariff retaliation on hold for 90 days to match Trump's pause
The European Union's executive commission said Thursday it will put its retaliation measures against new US tariffs on hold for 90 days to match President Donald Trump's pause on his sweeping new tariffs and leave room for a negotiated solution.
European Commission President Ursula von der Leyen said that the commission, which handles trade for the 27 member countries, “took note of the announcement by President Trump.” New tariffs on 20.9 billion euros ($23 billion) of US goods will be put on hold for 90 days because “we want to give negotiations a chance,” she said in a statement.
But she warned: “If negotiations are not satisfactory, our countermeasures will kick in.” Trump imposed a 20% levy on goods from the EU as part of his onslaught of tariffs against global trading partners but has said he will pause them for 90 days to give countries a chance to negotiate solutions to US trade concerns. (AP)
