The president’s reversal sent shockwaves through Washington. In a post on Truth Social, Trump said the 90-day pause was “written from our hearts.” Wall Street responded with a euphoric rally: the S&P 500 surged 9.5%, and the Dow Jones leapt nearly 3,000 points. But underneath the celebration was a grim truth—businesses and governments remain rattled by Trump’s whiplash policymaking.
A U-turn born of panic, not planning
Though the White House framed the retreat as a clever tactic to bring nations to the table, Trump admitted the shift wasn’t carefully crafted. “Just instinctively,” he told reporters. “You almost can’t take a pencil to paper. It’s really more of an instinct.”
Treasury Secretary Scott Bessent insisted that “this was his strategy all along,” suggesting the move rewarded countries that refrained from retaliating. Yet Trump undercut that narrative, saying his decision came together “fairly early this morning.” He added that people had been “getting yippy”—a golf term for panic—and needed reassurance.
Despite earlier claims the tariffs were non-negotiable, Trump now says, “You have to have flexibility.”
China still in the crosshairs
While others were granted temporary relief, China was not. Trump ramped up tariffs on Chinese goods to 125%, escalating a trade war that had already seen tit-for-tat measures. “China was the biggest abuser in history,” Trump said. “They want to make a deal. They just don’t know how quite to go about it.”Beijing hit back quickly. China’s foreign ministry spokesperson Lin Jian condemned the US for “bullying practices” and said America must show “an attitude of equality, mutual respect, and reciprocity” if it truly wants a resolution.The Chinese government responded with its own tariff hike—from 34% to 84%—on US imports. This came just hours after Trump’s latest round of duties went live.
Daniel Russel of the Asia Society Policy Institute said: “China is unlikely to change its strategy: stand firm, absorb pressure, and let Trump overplay his hand.” He added, “Other countries will welcome the 90-day stay of execution—if it lasts—but the whiplash from constant zigzags creates more of the uncertainty that businesses and governments hate.”
Chaos in the markets, calm in the messaging
Since announcing the tariffs last week, the administration has struggled to contain the fallout. Businesses paused investment. Households pulled back on spending. A Reuters/Ipsos poll found three in four Americans expect price rises in the months ahead.
The tariff plan introduced a 10% baseline levy on virtually all imports, with much steeper penalties—up to 100%—for countries labelled by the White House as “worst offenders,” including Vietnam, South Africa, and the EU. Those countries now face only the baseline 10%, for 90 days.
But not everyone is off the hook. Canada and Mexico remain subject to 25% fentanyl-related tariffs if they don’t comply with USMCA trade rules. Car imports and all steel and aluminium also continue to face 25% duties.
Goldman Sachs, which had raised the odds of a US recession to 65%, lowered them to 45% after the pause but warned that the remaining tariffs could still drive up overall rates by 15%.
Talks begin, but details are murky
So what comes next? Bessent, who is now spearheading negotiations with over 75 nations, offered few details. “You might even say that [Trump] goaded China into a bad position,” he claimed. Talks with Japan and South Korea have already begun, while a delegation from Vietnam was expected in Washington.
In the UK—which wasn’t hit with any additional tariffs—No. 10 welcomed the calmer tone. “A trade war is in nobody’s interests,” said a government spokeswoman. A separate source noted, “Cool and calm can pay off.”
Still, nothing is guaranteed. “Nothing’s over yet,” Trump said. “It’s all going to work out amazing.”
A volatile pattern with real-world costs
Trump’s tariff tactics have become a recurring pattern: grand declarations followed by sudden reversals. In just days, the world watched as Trump imposed new duties, defended them, then rolled most of them back—all while raising pressure on China.
As Dr Ngozi Okonjo-Iweala, head of the World Trade Organization, warned, “Our assessments, informed by the latest developments, highlight the substantial risks associated with further escalation.” WTO forecasts suggest the US-China dispute alone could slash goods trade by 80%, or around $466 billion.
For now, Trump insists his approach is working. “We don’t want to hurt countries that don’t want to be hurt,” he said. “And they all want to negotiate.”
But with public trust shaken, markets rattled, and diplomacy in flux, America’s tariff policy now appears to rest less on strategy and more on a single man’s instincts.
(With inputs from Reuters)
