Trump suspended part of the tariff hike for 90 days

U.S. President Donald Trump announced on Wednesday that he will freeze for 90 days the tariff changes he had announced on "Liberation Day" but that he will increase tariffs on China to 125%. During the 90-day period in which the previously announced tariffs will not be applied, a uniform 10% tariff floor will be in place.

"Due to the lack of respect that China has shown toward global markets (...) I am raising the tariff charged to China by the United States to 125%, with immediate effect," Trump wrote on his Truth Social network, just hours after Xi Jinping's government announced an 84% surcharge on U.S. products starting Thursday and vowed to "fight to the end." The Republican president stated that since more than 75 countries had contacted his administration's officials to request negotiations and "did not take any retaliatory measures," he decided to grant these nations "a 90-day pause and a substantially reduced reciprocal tariff during this period, set at 10%, also with immediate effect."

Treasury Secretary Scott Bessent confirmed this when specifically asked about countries already subject to a 10% tariff: "That will remain in place." U.S. government spokeswoman Karoline Claire Leavitt added that "the tariff level will be reduced to a universal 10%." Both officials stated that the government would continue to negotiate individually. This means that for Mercosur countries and others in the region, which had initially been subject to a 10% tariff, that rate will remain unchanged during this "pause" period announced by Trump.

"No one's 10% tariff is being postponed. Instead, for 90 days, many who had higher tariffs will see them reduced to 10%. This is initial information and could change," Uruguayan Foreign Ministry sources told El País.

Following the announcement of the tariff pause, major stock market indexes, as well as oil prices, surged sharply, though those gains were reversed on Thursday. Volatility remains high and will continue to be the norm.