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Trump tariff: Wall Street drops 4% despite pause on US levies
Trump tariff news: While Trump's 90-day pause on his levies for most countries helped global markets, the tiff between China and the US over the reciprocal tariffs continued to escalate throughout the day.
Trump tariff: US President Donald Trump late on Wednesday announced a 90-day tariff pause for most nations after his reciprocal levies triggered a massive trade war, with tensions escalating each passing day. However, Trump said that China wouldn't be exempted from the tariffs despite the pause. Trump raised the tariff rate for China to 145%, from the previously announced 104% tariff that had kicked off earlier on Wednesday. This came after China imposed an additional import levy on American goods, imposing an 84% tariff from Thursday.
...Read MoreThe US president said in a post on Truth Social that he was pausing his “reciprocal tariffs” on many other trading partners because they had responded by reaching out for talks rather than retaliating, blaming China for having a “lack of respect”.
Meanwhile, the 90-day halt on Trump's tariffs led the US stocks to surge to one of their biggest gains since World War II. The S&P 500 soared 9.5%, while the Dow Jones Industrial Average flew nearly 3,000 points higher, and the Nasdaq composite jumped 12.2%.
Trump tariff's | Key Points
- Donald Trump announced sweeping reciprocal tariffs on countries across the globe last week, with levies ranging from 10 per cent to 49 per cent. His move rattled global markets and sparked the start of a massive tariff and trade war.
- Trump's 26 per cent tariff on India came into effect on Wednesday, with authorities in New Delhi assessing the impact of the US levies.
- The trade war between China and the US has triggered fears among people as the two have hit each other with additional and retaliatory tariffs. China first retaliated with 34 per cent tariffs on US goods, following which Trump hit back with 104 per cent levies on Beijing. Again, in a tit-for-tat move, China upped the tariff rate on US goods to 84 per cent, prompting the US president to announce a 125 per cent tariff on Beijing effective immediately.
- The European Union on Wednesday also announced the approval of tariffs to hit around $23.2 billion of US goods in response to the 25 per cent duties on its steel and aluminium exports.
- Late on Wednesday, Trump announced a 90-day pause on all his reciprocal and global 10 per cent tariffs for most countries. The move led the US markets to witness one of their biggest gain days.
Trade War Live Updates: Markets across Europe, Asia also tumble
With the constant fears of the impact of Trump's trade war and concerns over chances of recession, stock markets tumbled across most of Europe and much of Asia.
Japan's Nikkei 225 sank 3.9 per cent, London's FTSE 100 dropped 2.9 per cent, and the CAC 40 in Paris fell 3.3 per cent.
Meanwhile, Chinese stocks were an outlier. Their indexes rose 0.7 per cent in Hong Kong and 1.3 per cent in Shanghai.
Trade War Live Updates: US stocks shake, bond markets in more stress
Amid the escalating trade war, triggered by Donald Trump's reciprocal tariffs, the US stock market is witnessing another shaky day.
Most of the markets tumbled as China and EU hit back at the US with retaliatory tariffs.
The S&P 500 was up 0.2 per cent in midday trading after quivering through the morning, AP reported.
EU follows in on China's footsteps, targets €21 billion worth goods with tariffs
After China, the European Union approved tariffs to hit around €21 billion ($23.2 billion) of US goods in retaliation for the 25 percent duties President Donald Trump imposed last month on the bloc’s steel and aluminum exports.
The tariffs will target politically sensitive American states and include products such as soybeans from Louisiana, home to House Speaker Mike Johnson, as well as diamonds, agricultural products, poultry, and motorcycles.
US reacts to China's 84% retaliatory tariff, says Beijing should come to table
Shortly after China announced 84 per cent retaliatory tariffs on American goods, US Treasury Secretary Scott Bessent told Fox Business Network that Beijing's levy is "unfortunate".
Bessent suggested that China “should not try to devalue their way out of” the tariff war, urging Beijing to come to the table for talks.
Instead, he said, China needs to punish those exporting fentanyl precursors to the US, an issue which has been long raised by American President Donald Trump.
Trade War Live Updates: China hits back at Trump with 84% retaliatory tariff on US goods
China on Wednesday hit back at Donald Trump's 104 per cent tariffs with its own additional tariffs of 84 per cent, up from the previously announced 34 per cent, on American goods.
The move came in the backdrop of rising tensions between Beijing and Washington over Trump's reciprocal tariffs.
Last week, after Trump's announcement, China had imposed a 34 per cent retaliatory tariff on US goods. However, the US President's move to impose 104 per cent tariffs on China has prompted the latter to up its tariff rate, taking it to 84 per cent.
What is Trade War?
Donald Trump's reciprocal tariffs triggered fears of a "trade war". The US president imposed levies on imports from several countries, including Canada, Mexico, China, India, Vietnam, Cambodia, etc.
A trade war is an economic conflict between two nations that erupts when one country responds to another's perceived unfair trade practices by imposing restrictions, such a tariffs, on imports.
Similar to issuing sanctions against a country, a trade war engages economic means to protest against a country or at times protect their own domestic goods from foreign competition.
However, it is possible that issuing high tariffs on imports could backfire on a country's citizens who would have to pay higher prices for goods.
Trade War Live Updates: Trump tariffs continue rising fears of global trade war, recession
US President Donald Trump last week announced sweeping reciprocal tariffs on countries across the globe, ranging from 10 per cent to 49 per cent. A levy of 26 per cent was also imposed on India.
The tariffs imposed by Trump rattled global markets, resulting in the crash of stock markets worldwide.
China, in particular, has been at loggerheads with the US over the levies.
