Trump China tariff hike took a dramatic turn on Wednesday as the US President eased duties for many countries. However, he simultaneously increased pressure on China. This sudden shift caused US stocks to soar.

Trump China Tariff Hike: Temporary Relief for Other Countries

In an unexpected move, Trump suspended new tariffs on several nations for three months. He claimed this pause would give time for negotiations. These talks will focus on reducing country-specific duties.However, a general 10% tariff on nearly all US imports will stay. Duties on cars, steel, and aluminum remain unaffected.

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Trump China Tariff Hike, Now at 125%

Trump China tariff hike reached a new high as the President raised duties on Chinese imports from 104% to 125%. This aggressive action follows a week of back-and-forth tariff increases between the two countries.

China, being the second-largest source of US imports, remains under heavy scrutiny. Trump’s administration shows no signs of backing down.

Markets React Strongly to Mixed Signals

Wall Street responded immediately. The S&P 500 jumped 9.5%, marking one of its strongest sessions in recent months. Bond yields declined, and the US dollar gained strength against safe-haven currencies.

Trump admitted the financial turmoil caught his attention. “I saw last night that people were getting a little queasy,” he said.

Concerns Still Loom Despite Temporary Gains

Despite the rally, experts remain cautious. Surveys report declining consumer spending and weaker business investments due to tariff fears. A recent Reuters/Ipsos poll revealed that 75% of Americans expect rising prices soon.

Goldman Sachs revised its recession risk from 65% down to 45% after the announcement. Yet, the overall tariff rate is expected to rise by 15%.

Strategic Negotiations Underway

Treasury Secretary Scott Bessent defended the decision. He said Trump created “maximum negotiating leverage” with his tactics. According to him, Trump China tariff hike exposed China as a global trade “bad actor.”

Talks are ongoing with Japan, South Korea, and Vietnam. Over 75 countries have reached out to discuss trade and foreign aid. However, US officials will prioritize non-China negotiations first.

Bessent declined to set a timeline but hinted that a deal with China could happen. Still, Trump’s priority remains building stronger ties with willing partners.

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