U.S. President Donald Trump announced on Wednesday that he was pausing planned tariff hikes on more than 75 countries while raising tariffs on China to 125%.
“Based on the fact that more than 75 countries have called representatives of the United States, including the Departments of Commerce, Treasury and the U.S. Trade Representative, to negotiate a solution to the subjects being discussed relative to trade, trade barriers, tariffs, currency manipulation and non-monetary tariffs, 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%, also effective immediately,” he wrote on his Truth Social platform.
Trump did not explicitly list the countries that would now only face a 10% tariff, but Israeli Prime Minister Benjamin Netanyahu flew to Washington earlier this week to argue that Israel, which lifted all tariffs on the United States, should not face the 17% tariff rate that the U.S. president announced on April 2.
“We will eliminate the trade deficit with the United States,” Netanyahu said in the Oval Office on Monday. “We intend to do it very quickly. We think it’s the right thing to do. And we’re going to also eliminate trade barriers, a variety of trade barriers put up unnecessarily.”
Trump has described the tariff rates as “reciprocal” despite Israel’s free trade agreement with the United States and even though Israel and some other countries have no tariffs on U.S. imports.
An equation published by the U.S. Trade Representative’s office revealed that the rates were calculated based on each country’s trade deficit in goods, but not services, with the United States.
The announcement of the tariffs sent stock markets into steep decline, while news of the pause on Wednesday sent the Dow up 2,900 points and sparked a 12% gain on the Nasdaq.
Trump told reporters in the Oval Office on Wednesday that he paused the tariffs because people were getting “a little bit afraid.”
“I thought that people were jumping a little bit out of line,” Trump said. “They were getting a little bit yippy.”
The one exception to the baseline 10% tariff pause is China, which will now face a 125% tariff rate.
“At some point, hopefully in the near future, China will realize that the days of ripping off the USA and other countries is no longer sustainable or acceptable,” Trump said in his announcement.
