Trump limits tariffs on most nations for 90 days

ECONOMY

But president raises taxes on Chinese imports

Traders work on the floor of the New York Stock Exchange during afternoon trading Wednesday in New York. The three major indexes closed high after an upswing spurred by President Donald Trump’s announcement of a pause in some tariffs. MICHAEL M. SANTIAGO — GETTY IMAGES

Image

By Josh Boak

The Associated Press

WASHINGTON>> Facing a global market meltdown, President Donald Trump on Wednesday abruptly backed off his tariffs on most nations for 90 days even as he further jacked up the tax rate on Chinese imports to 125%.

It was seemingly an attempt to narrow what had been an unprecedented trade war between the U.S. and most of the world to a showdown between the U.S. and China. The S&P 500 stock index jumped 9.5% after the announcement, but the drama over Trump’s tariffs is far from over as the administration prepares to engage in country-by-country negotiations. In the meantime, countries subject to the pause will now be tariffed at 10%.

The president hit pause in the face of intense pressure created by volatile financial markets that had been pushing Trump to reconsider his tariffs, even as some administration officials insisted the his reversal had always been the plan.

As stocks and bonds sold off, voters were watching their retirement savings dwindle and businesses warned of worse than expected sales and rising prices, all a possible gut punch to a country that sent Trump back to the White House last year on the promise of combatting inflation.

The global economy appeared to be in open rebellion against Trump’s tariffs as they took effect early Wednesday, a signal that the U.S. president was not immune from market pressures. By early afternoon, Trump posted on Truth Social that because more than 75 countries had reached out to the U.S. government for trade talks and had not retaliated in meaningful ways, “I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately.”

Shares of Colorado’s largest public company, Palantir, surged 19% to $92, pushing its market value to $215 billion. Apparel importer VF Corp., owner of The North Face and Vans, saw its share price rise 27.2% to close at $12.3. Shoemaker Crocs Inc. didn’t rise as much, but enjoyed an 11.5% gain that brought its share price back to $99.59.

Shares of oil field service company Liberty Energy rose 16.6% and shares of producer Civitas rose 24.6%, after crude prices rebounded following the announcement of the tariff suspension.

Trump later told reporters that he pulled back on many global tariffs — but not on China — because people were “yippy” and “afraid” due to the stock market declines.