Trump Implements 90-Day Halt on Tariff Increases, Raises China Duties to 125%

On April 9, 2025, President Donald Trump declared a 90-day suspension of increased tariffs impacting numerous trade partners, while simultaneously escalating duties on China to 125%.

• President Donald Trump announced a 90-day pause on higher tariffs that hit dozens of trade partners, causing stocks to stage their best rally since 2008 and the S&P 500 Index to soar 9.5%.
• The president’s decision to backtrack on the tariffs came after massive pressure from business leaders and investors, and roughly 13 hours after high duties on 56 nations and the European Union took effect.
• Trump raised duties on China to 125%, and investors and observers will now shift attention to China to see if the country will increase its tariffs or signal openness to negotiation.

This decision came after his trade war caused market turmoil and recession fears, with pressure from business leaders and investors for him to reverse course. Trump’s announcement led to a significant stock market rally, with the S&P 500 Index soaring 9.5% and the Nasdaq 100 surging 12%.

The US Treasury yields also stabilized, and Goldman Sachs Group Inc. economists rescinded their forecast for a US recession. The focus now shifts to China’s response and potential negotiations. Trump stated that he didn’t think he would have to raise the rate higher to force talks and that he made the decision after consulting with Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick.

Countries affected by the higher duties will now be taxed at the earlier 10% baseline rate, except for China. US tariffs on steel, aluminum, automobiles, and specific Canadian, Mexican, and EU goods remain unchanged. Trump also plans to move forward with tariffs on other sectors, including pharmaceuticals.