US President Donald Trump on Wednesday said he would temporarily lower new tariffs on many countries, even as he raised them further on imports from China, in a sudden reversal that sent US stocks sharply higher.
Trump's announcement came less than 24 hours after steep new tariffs kicked in on imports from dozens of trading partners. The new trade barriers have hammered markets, raised the odds of recession and prompted retaliatory responses from China and the European Union.
Trump said he would raise the tariff on Chinese imports to 125% from the 104% level that took effect at midnight, further escalating a high-stakes confrontation between the world's two largest economies.
Suspending targeted tariffs during negotiations
Trump said he would at the same time suspend targeted tariffs on other countries for 90 days to allow time for US officials to negotiate with countries that have sought to reduce them.
A 10% blanket duty on almost all US imports will remain in place, the White House said. The announcement also does not appear to affect duties on auto, steel and aluminum that are already in place.
US stock indexes shot higher on the news, with the benchmark S&P500 up more than 6%. Bond yields came off earlier highs and the dollar rebounded against safe-haven currencies.