#TariffsPause Why is there a Tariff Pause?

• Immediately after the new tariff rates came into effect, the US financial markets reacted negatively: stocks plummeted sharply, and bond yields skyrocketed.

• In response to that pressure, President Trump quickly announced a 90-day suspension of tariffs to allow for bilateral negotiations with partner countries.

• Imports from China, however, still face very high tariffs (145%).

Objectives of the Tariff Pause:

• Create time for negotiations, avoid immediate retaliatory measures from other countries.

• Reduce economic tension, temporarily stabilize the financial markets.

Impact:

• After the announcement of the tariff suspension, the US stock market rebounded strongly (the S&P 500 index rose 9.5% - the highest single-day increase since October 2008).

• However, uncertainty remains due to the uncertain outcomes of the negotiations.

Conclusion:

• The "Tariff Pause" is only a temporary measure and does not address the root of the ongoing trade war between the US and other countries.