WASHINGTON. In a dramatic shift, U.S. President Donald Trump on Wednesday announced a temporary rollback of sweeping new tariffs he had just imposed on dozens of countries, a move that triggered one of the most historic market rallies since the early days of the COVID-19 pandemic.
“The Department of Foreign Affairs is informed by the Philippine Embassy in Yangon of the positive identification of the remains of a second confirmed Filipino victim of the powerful 7.7 earthquake which hit Myanmar last March 28,” according to the DFA statement.
The surprising about-face came less than 24 hours after the United States implemented a broad range of steep new tariffs on nearly all major trading partners. The initial announcement caused a wave of market volatility that wiped trillions of dollars from global equities and sent U.S. government bond yields surging — a reaction that appeared to prompt the president’s rethink.
“I thought that people were jumping a little bit out of line, they were getting yippy, you know,” Trump said to reporters, referencing a golf term.
Despite his earlier insistence that the tariffs were non-negotiable, Trump defended the sudden reversal as a demonstration of his strategic flexibility. “You have to be flexible,” he said.
However, the shift does not signal a complete retreat. A 10% blanket tariff on nearly all U.S. imports remains in place, and Trump is doubling down on pressure against China — announcing an increase in tariffs on Chinese imports from 104% to 125%, escalating the ongoing trade confrontation between the world’s two largest economies.
U.S. Treasury Secretary Scott Bessent claimed the pullback was part of a calculated strategy to push countries toward the negotiating table. “This was his strategy all along,” Bessent told reporters. “And you might even say that he goaded China into a bad position.”
Despite this, Trump acknowledged that the intense market reaction affected his decision. “China wants to make a deal,” he said. “They just don’t know how quite to go about it.”
The temporary 90-day freeze does not apply to duties on autos, steel, and aluminum, nor does it lift the 25% fentanyl-related tariffs on Canadian and Mexican goods that don’t comply with the U.S.-Mexico-Canada Agreement (USMCA). An indefinite exemption remains in place for USMCA-compliant goods.
The abrupt U-turn sent global stock markets soaring. The S&P 500 surged by 9.5%, bond yields fell from their earlier highs, and the U.S. dollar rebounded against safe-haven currencies.
Still, economic analysts warned the damage may be lasting. A Reuters/Ipsos survey found that three out of four Americans expect prices to rise in the coming months. Meanwhile, Goldman Sachs cut its recession probability from 65% to 45%, warning that the remaining tariffs could still drive an overall 15% increase in the average tariff rate.
“China is unlikely to change its strategy: stand firm, absorb pressure, and let Trump overplay his hand. Beijing believes Trump sees concessions as a weakness, so giving ground only invites more pressure,” said Daniel Russel, Vice President of International Security and Diplomacy at the Asia Society Policy Institute.
“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,” Russel added.
Behind the scenes, negotiations are ongoing. According to the White House, Trump has spoken with the leaders of Japan and South Korea, while a Vietnamese delegation met with U.S. officials on Wednesday to discuss trade concerns. More than 75 countries have reached out to Washington for clarification or exemptions.
Despite the White House previously calling reports of a tariff pause “fake news,” Trump hinted that he had been considering it for days. Earlier on Wednesday, he took to Truth Social to reassure investors:
“BE COOL! Everything is going to work out well. The USA will be bigger and better than ever before!”
Later, he added: “THIS IS A GREAT TIME TO BUY!!!”
While Trump’s strategy continues to draw criticism for its unpredictability, his supporters argue it reflects a hard-nosed approach to leverage and negotiation. Whether the markets — and America’s trading partners — can endure the uncertainty remains to be seen.
Edgaroo Hernal started college at UP Diliman and received his BA in Economics from San Sebastian College, Manila, and Masters in Information Systems Management from Keller Graduate School of Management of DeVry University in Oak Brook, IL. He has 25 years of copy editing and management experience at Thomson West, a subsidiary of Thomson Reuters.
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