Global trade war on hold as Trump U-turns on tariffs

President initiates 90-day pause while hiking duties on China

- ALASTAIR JAMIESON JOHN BOWDEN ANDREW FEINBERG KATE DEVLIN

After days of panic on financial markets, Donald Trump abruptly changed course on tariffs last night with a 90-day pause for dozens of nations – but he escalated his tit-for-tat trade war with China by imposing extra duties of 125 per cent.

The US president said people “were getting a little bit yippy, a little bit afraid” hours after boasting that world leaders were “calling us up, kissing my ass to negotiate deals”.

A UK government source said that the pause vindicated Sir Keir Starmer’s decision not to retaliate immediately on tariffs. “Cool and calm can pay off,” the source said.

He said yesterday that his decision was made in response to days of market panic and rippling effects across various economic sectors, which Mr Trump and other White House officials spent days unsuccessfully trying to quell.

Mr Trump’s abrupt reversal of what he had characterised as a signature policy initiative meant to reverse decades of globalisation and international integration of supply chains put a temporary stop to a week of uncertainty in international capital markets and fears among American investors that their savings were being wiped out.

It also came just days after White House officials said Mr Trump would not reverse course despite criticism from Republican Party representatives.

“Based on the fact that more than 75 countries have called representatives of the United States ... and that these countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90-day PAUSE, and a substantially lowered reciprocal tariff during this period, of 10 per cent, also effective immediately,” the president wrote yesterday.

He added of China: “At some point, hopefully in the near future, China will realise the days of ripping off the USA, and other countries, is no longer sustainable or acceptable.”