Trump authorizes 90-day pause on most tariffs

Canadian Prime Minister Mark Carney said Donald Trump's pause on reciprocal tariffs was a "welcome reprieve for the global economy," in a post on social media on Wednesday.

"As President Trump and I have agreed, the US President and the Canadian Prime Minister will commence negotiations on a new economic and security relationship immediately following the Federal election," Carney wrote on X.

"As part of today’s announcement, the President has signaled that the US will engage in bilateral negotiations with a number of other countries. This will likely result in a fundamental restructuring of the global trading system."

Republican allies of President Donald Trump in the US House of Representatives prevented a bid by the minority Democrats to force a vote on eliminating Trump's scaled-down global tariffs.

A measure approved in a roughly party-line vote allows Speaker Mike Johnson to stop any Democratic resolution to cancel the national emergency Trump declared to justify imposing the levies. 

Democrats accused Republicans of allowing Congress to become a bystander on foreign trade rather than honoring its duty of oversight set out in the constitution.

"The speaker is petrified that members of this House will actually have to take a vote on lowering costs for the American people," Congressman Gregory Meeks, who led the effort to rein in Trump, said in the House.

But Republican committee chair Virginia Foxx called out Democrats, saying they had used a similar legislative tactic in 2021 to stop Republicans from ending the national emergency dealing with the Covid-19 pandemic by then-president Joe Biden.

Johnson has stood by the president, telling reporters that Trump had "an appropriate level of authority" to deal with unfair trade practices. 

Democratic legislative efforts to stop Trump from carrying on with his tariff policy were likely doomed, as it would still require the support of two-thirds of both chambers of Congress in order to overcome a likely Trump veto. Both chambers are currently Republican controlled.

President Donald Trump said the US bond market "now is beautiful," seeking to reassure reporters that his tariff delay had allowed the bond market to recover.

US government bonds, also known as Treasurys, had been particularly volatile in recent days, especially since Trump announced global tariffs.

The bond market is where a country's debt is traded over a repayment horizon of up to 50 years. Unlike the stock market, the investment of bonds is longer term and it can be an indicator of confidence or a lack there of for a country's economy.

Investors seek higher returns when they judge a government's debt to be riskier, pushing up bond yield.

US Bond yields jumped in recent days, before falling slightly after Trump abruptly reversed course and paused the tariffs.

The bond hike was notable because US Treasury yields have historically dropped, not risen, during uncertain and volatile times for the stock market, as bonds are usually seen as some of the safest possible investments.

Trump acknowledged the "very tricky" state of the crucial US bonds market prior to his decision to pause the global tariffs.

"I was watching the bond market. The bond market is very tricky. I was watching it," he told reporters.

"I saw last night where people were getting a little queasy," Trump added.

US President Donald Trump spoke to reporters about the 90-day pause on tariffs, saying he acknowledged that people were getting "a little bit afraid" about the tariffs and were "jumping a bit out of line."

Trump said the tariffs pause was for countries that didn't retaliate, which explained why China wasn't included.

"China wants to make a deal. They just don't know how quite to go about it... President Xi (Jinping) is a proud man... They don't know quite how to go about it, but they'll figure it out," Trump said.

Treasury Secretary Scott Bessent also spoke about what's next, saying that the negotiations with individual countries would be "bespoke," meaning that the next 90 days would involve talks on a flurry of potential deals.

Bessent tried to reassure reporters that the tariff pause decision had nothing to do with negative reactions from the financial markets to the tariff policy.

The treasury secretary said he and Trump "had a long talk on Sunday, and this was his strategy all along" and that the president had "goaded China into a bad position."

"The only certainty we can provide is that the US is going to negotiate in good faith, and we assume that our allies will too," Bessent said.

In an interview with broadcaster RTL, Germany's chancellor-designate Friedrich Merz said US President Donald Trump's pause of tariffs for 90 days showed that a united European approach to trade was having a positive effect.

"Europeans are determined to defend ourselves and this example shows that unity helps most of all," Merz said following his conservative CDU party's sealing of a coalition deal with the Social Democrats SPD to form a government.

Merz called for free trade relations with the US.

"Let's all set tariffs of 0% on transatlantic trade, and then the problem will be solved," Merz added.

US stocks spiked in the last hours of trading, in reaction to President Donald Trump's latest announcement on tariffs. 

The major stock major averages, Nasdaq, S&P and Dow Jones all rose, partly offsetting the steep losses posted over the past few sessions, after Trump had announced the global tariffs.

In more good news for financial markets, the US dollar — which had been lower earlier in the day — also strengthened against the yen and other currencies after Trump's tariff delay announcement.

US Treasury yields meanwhile pared gains after an auction of 10-year Treasury notes saw strong demand.

The rally in the financial markets comes as many had worried that Trump's global tariffs could trigger a recession in the US.

 

Trump says he's backing down on most nations' tariffs for 90 days amid market meltdown. He however added that he's raising tariffs on China to 125%.

The White House confirmed Trump's announcement of a 90-day tariff "pause" saying it means that the "tariff level will be brought down to a universal 10% tariff."

US President Donald Trump took to his Truth Social network to urge for calm, as countries, politicians and the stock market continue to react to his global tariffs.

"BE COOL! Everything is going to work out well. The USA will be bigger and better than ever before!" Trump posted.

The remark comes as more Republicans are going public with their worries about the effects of Trump's tariffs

"People are going to look at their 401(k) statements. They did vote for President Trump and they voted for me. ... I'm just trying to figure out if they are going to feel good about this," said Thom Tillis of North Carolina, one of seven Senate Republicans who have signed on to a bipartisan bill that would give Congress the authority to review and override new tariffs.

Republican Senator John Kennedy of Louisiana has publicly voiced similar concern.

"It's not fun. I don't like it. I like it when the market goes up," Kennedy told reporters. He said he wants to give Trump's gambit a chance, but that the president ought to do a better job of informing the public about his short-term goals.

But Trump has so far not listened to his detractors, sending a clear message to those who oppose tariffs in a speech he gave the during a dinner with fellow Republicans, where he mocked Republican concerns about tariffs and said the policy was working because now countries were "dying" to make a deal.

"I'm telling you, these countries are calling us up, kissing my ass," Trump said.

Responding to questions after they announced a deal to form a new German coalition government, leaders were asked what their message would be to US President Donald Trump in the wake of trade tariffs imposed on the EU.

"A key message to Donald Trump is, Germany is back on track," said chancellor-in-waiting Friedrich Merz, replying in English to a question from DW political editor Michaela Kuefner.

Merz said Germany was ready to strengthen its defense spending, something Trump has maintained is necessary, but also that Berlin wanted to improve its competitiveness from the point of view of trade.

"That is also the European Union. And Germany will be once again a very strong partner in the European Union and we will bring the European Union forward," he said.

"I fully agree," Social Democrat co-leader Lars Klingbeil briefly added in English.

In his response, CSU leader Markus Söder quipped, "I'll be back," referring to the catchphrase of Arnold Schwarzenegger's character in the Terminator movies.

US Treasury Secretary Scott Bessent said many countries were interested in striking fresh trade deals with Washington as the Trump administration's sweeping tariffs came into effect across the globe.

Speaking to a summit of the American Bankers Association in Washington on Wednesday, Bessent said Trump had already spoken with the leaders of Japan and South Korea, and US officials were set to meet with a delegation from Vietnam later in the day.

"I think ... at the end of the day that we can probably reach a deal with our allies, with the other countries that have been ... good military allies and not perfect economic allies. And then we can approach China as a group," he said.

Bessent said that aligning instead with China "would be cutting your own throat."

"They just keep producing and producing, dumping and dumping, and it's going somewhere," he said.

Bessent also accused China of escalating the situation after the US repeatedly introduced tariffs on Chinese imports that now total 104%.

"I think what a lot of people are missing here is that the levels that were put out last Wednesday are a ceiling if you don't retaliate," he said.

French Trade Minister Laurent Saint-Martin said that Europe wishes to avoid escalation in any trade war with the US.

"We never wanted tariffs to escalate. We believe that a tariff war is harmful for everyone," he told reporters during an official visit to Indonesia on Wednesday.

Saint-Martin called for further negotiations with Washington to find a solution.

"Under the aegis of the European Commission, we must continue the work of dialogue and negotiation with the US administration in order to achieve the most positive agenda possible," he said. 

The European Union agreed on Wednesday to go ahead with its own tariffs on US imports in retaliation for President Donald Trump's previously-announced levies on European steel and aluminum.

The EU tariffs will range from 15% to 25%, targeting US goods and commodities like soybeans, fruit, motorcycles, beauty products, clothes and dental floss. They will come into action next Tuesday.

"These countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome," the European Commission said in a statement.

China lodged a new complaint with the World Trade Organization on Wednesday after the US further increased tariffs on Chinese imports to 104%.

"The situation has dangerously escalated... As one of the affected members, China expresses grave concern and firm opposition to this reckless move," the Chinese mission to the WTO said in a statement provided to Reuters.

Beijing has accused the US of violating WTO rules and said undermining the multilateral trading system. China has called on the WTO Secretariat to study the impact of tariffs on global trade and report its findings to members.

"Reciprocal tariff is not - and will never be - a cure for trade imbalances. Instead, they will backfire, harming the US itself," Beijing warned.

Several countries spoke out at the meeting of the WTO, also arguing that Trump's tariffs imposed violate international trade rules. These included Canada, Switzerland and the EU.

The move was also reported by Chinese state media.

US President Donald Trump on Wednesday urged companies to relocate their operations to the US in order to avoid tariffs.

"This is a GREAT time to move your COMPANY into the United States of America," Trump said on his Truth Social platform.

He promised businesses "ZERO TARIFFS," and "no environmental delays."