On April 9, 2025, U.S. President Donald Trump initiated a 90-day pause on tariffs for most countries, offering a temporary respite from escalating trade tensions, while simultaneously ratcheting up tariffs on Chinese imports to a staggering 125%. This sudden shift came after a period of intense global market volatility, leaving many wondering if it was a strategic masterstroke or a reactive retreat.

Trump Pauses Tariffs on Most Countries for 90 Days: A Moment of Relief or a Tactical Maneuver?

The Week the World Held Its Breath

Before the pause, Trump's trade policies, a key part of his “America First” agenda, had been gaining traction. Just a week prior, he implemented a 10% tariff on all imports, along with additional “reciprocal” tariffs on nearly 90 countries based on their trade deficits with the U.S. The aim was to combat what he considered unfair trade practices and the decline of American manufacturing.

The global response was swift and severe, I remember seeing the headlines and the worry etched on people's faces.

• Stock markets plummeted, wiping out trillions in value.
• The S&P 500 experienced its worst week since the 2008 financial crisis.
• Business leaders, including some of Trump's allies, warned of an impending recession.

Billionaire Bill Ackman even described the tariffs as an “economic nuclear war,” a sentiment that resonated with many. Facing this intense pressure, Trump seemingly shifted gears.

In a Truth Social post, he announced the 90-day pause, citing the willingness of over 75 countries to negotiate trade solutions. The universal tariff rate would drop to 10% for these nations, effective immediately. It felt like a collective sigh of relief rippled across the globe.

China: The Exception to the Rule

While most countries received a break, China was singled out for a hefty 125% tariff hike. Trump justified this as a response to Beijing’s “lack of respect” for global markets and its retaliatory tariffs on American goods.

This escalation marks a new high in the U.S.-China trade war, a conflict that has been a recurring theme during Trump's time in office. Treasury Secretary Scott Bessent painted China as the “biggest source” of America’s trade problems. The message was clear: cooperate, and you will be rewarded; retaliate, and face the consequences.

Trump also expressed optimism that Chinese President Xi Jinping would eventually seek a deal, but without specific concessions, I am not sure how this would play out.

A Calculated Move or a Quick Fix?

The White House presented the 90-day pause as a strategic play, designed to bring nations to the negotiating table. Bessent even claimed this was “his strategy all along.”

However, the suddenness of the reversal, just hours after the reciprocal tariffs took effect, suggests a reaction to an immediate crisis. The market turmoil and warnings from economic figures like Jamie Dimon likely played a significant role in Trump's decision.

For Trump, this pause strikes a balance between his tough trade rhetoric and political practicality. The initial tariff rollout raised concerns about voter backlash due to rising prices, something he couldn't afford with midterm elections approaching. By easing the pressure on most nations, he buys time to negotiate while maintaining his tough stance on China, which remains popular with his supporters.

Economic Ripple Effects: Relief and Lingering Concerns

The announcement triggered an immediate surge in global markets. On April 9, the S&P 500 jumped 9.5%, its best single-day gain since 2008, while the Dow Jones Industrial Average soared nearly 3,000 points.

• Tech companies like Apple and Nvidia saw double-digit gains.
• Asian and European markets followed suit.

The relief was palpable after a week that had erased $6 trillion in U.S. stock value.

However, the pause isn't a complete reset. The 10% universal tariff remains, along with existing levies on steel, aluminum, and autos. Economists warn that these measures, combined with the China tariffs, still pose significant risks.

According to Goldman Sachs, the U.S. economy is “not out of the woods.” JPMorgan pegged the recession odds at 60%, arguing that the 10% tariff alone represents a “large shock.”

For businesses, the 90-day window presents both opportunity and uncertainty. Companies that had scaled back forecasts due to tariff fears now have a reprieve, but must prepare for potential hikes if negotiations fail. Consumers may see a temporary halt to price increases, but the China tariffs could still drive up costs for goods sourced from there.

Global Perspectives and the Road Ahead

The pause has been met with cautious optimism internationally. Canadian Prime Minister Mark Carney called it a “welcome reprieve,” while the European Union mirrored the move by pausing its retaliatory tariffs for 90 days to allow negotiations. Japan has pressed for a review of existing steel and auto tariffs, signaling that the pause is just the beginning.

The next three months will be crucial in determining whether Trump can turn this leverage into meaningful deals. Bessent hinted at talks on various issues, including liquefied natural gas, non-tariff barriers, and currency policies. For China, the stakes are high: its economy, already strained by the trade war, faces a significant hit from the 125% tariffs, potentially forcing concessions or further escalation.

The Bottom Line: A Risky Move with Uncertain Outcomes

Trump’s decision reflects his penchant for dramatic actions and the limitations of his economic brinkmanship. It's a high-stakes gamble aimed at reshaping global trade dynamics while maintaining his image as a tough negotiator.

While the world breathes a sigh of relief for now, the clock is ticking. By July 2025, the outcomes of these negotiations will determine whether this pause leads to trade stability or merely delays a looming crisis. As Trump put it, “Nothing’s over yet.” Only time will tell if the spirit of cooperation he mentions will translate into concrete results.

In conclusion, while this move offers temporary relief, the long-term implications are far from certain. We need to closely observe the negotiations and their outcomes in the coming months to fully understand the impact of this decision. I will be watching!