Markets are rebounding after Donald Trump froze worldwide tariffs at 10% for 90 days – except on China, which now faces a 125% levy. Beijing’s retaliatory measures are in effect from today. Listen to the Trump 100 podcast – on the trade war between the two countries – as you scroll.
Thursday 10 April 2025 07:42, UK
Live reporting by Bhvishya Patel
Stock markets have rallied after Donald Trump reversed most of his tariffs for 90 days.
The US president’s top- level import taxes have been paused – instead a default 10% tariffs will apply to almost all countries.
China is the only exception, with Trump imposing a huge 125% tariffs after China retaliated to his trade war with an 84% tariff of its own.
Trump has indicated that the 90 days will be used to strike deals and claims around 75 countries have asked the White House for talks.
After a week of tanking, US stocks made up much of the ground after Trump’s reversal last night – and Asian stocks are also up this morning.
For the UK, little has changed – it already had the lower 10% base tariff.
The background to all this is the White House believing the US has been on the wrong end of tariffs for decades. Trump hopes his policy will encourage companies to manufacture inside the US and thus “make America wealthy again”. Some have suggested his shock imposition of tariffs could also be a negotiating tactic to secure favourable trading terms.
China’s yuan has hits its weakest level in more than 17 years as an escalating trade war with the US rattles currency markets.
As we’ve been reporting, Beijing has imposed steep tariffs on US imports in response to similar US action.
And now figures show the onshore yuan has slipped to 7.3518 a dollar in early trade, its weakest since 26 December 2007.
A weaker yuan would make Chinese exports cheaper and alleviate tariff impact on the economy.
However, a sharp decline could also increase unwanted capital outflow pressure and risk financial stability, analysts say.
Giving in to the US is “not an option for China”, our Asia correspondent Helen-Ann Smith reports.
While it is “time to take a breath for many countries” after Trump’s 90-day tariffs pause – this is not the case for China.
“It is likely that China will again retaliate,” Smith says.
“I think both sides have put themselves in a place where they cannot be seen to back down. Both crave dominance, and both don’t want to be seen to be losing.
“And there are questions about what that means and looks like.”
In Beijing, officials see Trump’s move as a direct attack.
“There is a genuine belief in the system in China that the US’s ultimate goal is to restrain China, undermine it and restrict its growth,” Smith says.
“So giving in to Trump doesn’t serve any purpose for China. Giving in is not an option.”
When it comes to a deal between the US and China, she says, it is “not impossible” but it will be “complicated”.
A week after his “liberation day” tariff announcement sent markets reeling, Donald Trump changed course suddenly last night.
He froze most tariffs at 10% in a surprise post on Truth Social and then told reporters at the White House he would be “flexible”.
Investors rejoiced after bracing for a global economic meltdown.
Here’s how the president summed up the day – at 12.45am Washington time…
The trade war between the world’s two biggest economies enters a new day.
Trump’s tariff pause last night excluded China, and Beijing’s retaliatory measures came into effect this morning.
The countries’ tit-for-tat moves have kept traders on the edge of their seats and it’s unclear what will happen next.
Here is what the countries face now…
China
Trump raised tariffs to 125% “with immediate effect” yesterday.
The US
Beijing responded to Trump’s initial tariffs with a duty of 84% on US goods – effective from 12.01am today.
Most of the rest of the world faces a baseline 10% tariff after Trump rolled back his higher levies on around 60 of the “worst offender” countries. Mexico and Canada are the exceptions.
Asian markets have rebounded this morning after Donald Trump’s tariff reversal.
Japan’s Nikkei index, which had dropped as much as 13.81% after Trump announced sweeping import duties on 2 April, has rebounded by around 8.5%.
In Hong Kong, stocks surged while Shanghai also advanced.
The Hang Seng Index climbed 2.69%, or 545.94 points, to 20,810.43, while the Shanghai Composite Index has jumped 1.29%, or 41.03 points, to 3,227.84
And Australia’s S&P/ASX 200 soared 5.1% to 7,748.00.
Singapore’s FTSE Straits Times index surged as much as 9%.
Welcome back to our live coverage of Donald Trump’s tariffs.
The US president made the decision yesterday to pause the hefty duties he had imposed on dozens of countries for 90 days – sending global stock markets rallying after days of turmoil.
The turnaround came less than 24 hours after he had imposed the steep new tariffs on around 60 countries that he had labelled the “worst offenders” for imbalanced trade with the US.
But in the same breath he tightened the screws on China, escalating the trade war between the world’s biggest economies by hiking levies on imports to 125%, up from 104%.
Beijing hit back, announcing an 84% retaliatory tariff on US imports that went into effect today.
Before we bring you the latest today, here are the other key developments from the past 24 hours:
You can watch the moment Trump announced the tariff pause here:
We’re pausing our coverage there, following a day of significant escalations in the US-China trade stand-off.
Donald Trump announced an increase on Chinese tariffs to 125%, while announcing a 90-day pause on higher levies for dozens of other countries – see our post below for more on what this all means.
We’ll have more Asian and European reaction – both from the markets and political sphere – early in the morning.
But until then, our US correspondent James Matthews breaks down what you need to know so far in this 60-second clip…
There’s been a lot to unpack tonight.
To cut through it all, here’s what Donald Trump’s tariff pause entails:
‘Reciprocal’ tariffs on hold
China tariffs increased
No change for Canada or Mexico
Car and metal tariffs remain
Sectors at risk
Donald Trump may be heading for a crash in popularity, according to one of the world’s eminent historians.
Speaking before Trump’s tariff reversal, Sir Niall Ferguson spoke on our podcast The World with Richard Engel and Yalda Hakim.
“Higher prices plus higher unemployment will make him less popular,” he said, as he set out the path unravelling before the Republican Party.
Watch the clip below, and check out the podcast in the link at the bottom of this post.
👉Listen to The World with Richard Engel and Yalda Hakim on your podcast app👈
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