On April 10, 2025, President Donald Trump announced a 90-day suspension of new reciprocal tariffs for most U.S. trading partners, temporarily easing trade tensions and offering relief to dozens of countries. The elevated tariffs set to hit many nations were paused, with a new universal 10% “minimum base tariff” remaining in effect for all imports except those from China.

However, China was excluded from this tariff pause. Instead, Trump announced a dramatic escalation: U.S. tariffs on Chinese imports were immediately raised to 125%, on top of a previously imposed 20% rate, bringing the effective tariff to 145% on most Chinese goods. This decision came in direct response to China’s own retaliatory tariffs, which had reached 84% on U.S. goods by April 10 and were set to rise to 125%.

The White House framed the suspension for most countries as a strategic move to allow for ongoing negotiations and to reduce global market turmoil. The exclusion of China signals a continued hardline stance in the U.S.-China trade war, with both sides escalating duties and threatening further economic disruption.

Market Impact:
The announcement triggered volatility in financial markets. U.S. government bond yields spiked to their highest levels since early 2025, while stock indices initially plunged on tariff fears before rebounding sharply after the pause for most countries was confirmed. Analysts warn that the elevated tariffs on China could drive up prices for U.S. consumers and businesses, while the global 10% baseline tariff remains a significant shift in American trade policy.

Summary:

• 90-day suspension of new reciprocal tariffs for most countries (until July 8, 2025)
• China excluded: U.S. tariffs on Chinese goods raised to 145%
• Universal 10% tariff remains for all imports
• Global markets remain volatile, and the risk of further escalation persists

This latest move underscores the uncertainty and complexity of the current global trade environment, with the U.S. maintaining pressure on China while seeking negotiations with other partners.

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