China’s new tariffs on US goods to come into effect as Trump pauses measures for other countries – business live

Global stock markets, particularly in Asia, witnessed a significant recovery on Thursday. This surge followed an unexpected policy shift by US President Donald Trump, who softened his stance on imposing widespread reciprocal tariffs, a move initially causing considerable market volatility.

In Japan, the Nikkei 225 index experienced a substantial climb of 7.2%, reaching 33,999.33 points. Similarly, South Korea’s Kospi index jumped by over 5%. The Australian ASX 200 also saw a robust increase, exceeding 6% gains.

The positive momentum extended to Wall Street on Wednesday, where the Dow Jones Industrial Average soared, concluding nearly 8% higher. The Nasdaq Composite Index also recorded an impressive 12.2% increase, marking its most successful trading day in 24 years.

Australia has declined China’s appeal for a collaborative effort to protect global trade. This refusal comes as Beijing seeks allies to counter escalating US tariffs, which have now reached 125%, according to Agence France-Presse reports.

Xiao Qian, the Chinese ambassador, in an opinion piece published in a Sydney-based newspaper, had called upon Australia and other trading nations to “collectively address the evolving global landscape.”

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“In this changing environment, China is prepared to cooperate with Australia,” Ambassador Xiao stated in the Sydney Morning Herald.

However, Richard Marles, Australia’s Defence Minister, promptly dismissed any idea of unity between Canberra and Beijing in a “shared objective”.

“We are not going to find common ground with China; that is not the intended course of action,” Marles asserted in an interview with Australia’s Nine News.

“I don’t foresee aligning with China on this issue.”

“While we aim to avoid a trade conflict between the US and China, our priority remains diversifying our trade relationships,” he clarified.

Just hours before China’s retaliatory tariffs were scheduled to take effect, the nation’s commerce minister denounced the US’s ‘reciprocal tariffs’ as “a severe infringement upon the legitimate interests of all countries involved in international trade”.

According to a report by Xinhua, a Chinese state news agency, a ministry official had earlier commented that a trade war would yield no winners.

“I must stress that trade disputes benefit no party and are not something China desires. However, the Chinese government is committed to taking necessary actions when the lawful rights and interests of its citizens are undermined,” the official stated on Wednesday.

In a surprising turnaround, President Trump has temporarily suspended high tariffs for most nations for 90 days. However, this pause excludes China, a major source of US imports, which remains a key point of contention.

Conversely, tariffs on Chinese goods are now elevated to 125% by the US, while China has announced new 84% tariffs on all goods imported from the US. This exchange further intensifies the high-stakes economic confrontation between the world’s two largest economies.

According to insights from our correspondent in China, Amy Hawkins, Beijing is unlikely to concede ground initially. A significant advantage for Beijing is the greater reliance of the US on imports from China compared to China’s dependence on US imports.

“For President Xi, the only politically viable response to Trump’s recent escalation is defiance. Having already surprised domestic audiences with a robust 34% reciprocal tariff, any indication of retreat would be politically unsustainable,” notes Diana Choyleva, founder and chief economist at Enodo Economics, a forecasting firm.”

Welcome back to our live coverage of what has proved to be a turbulent week for global markets, largely attributed to US President Trump’s surprising tariff policies.

The disruptions have eliminated trillions of dollars in stock market value and triggered an unsettling increase in US government bond yields, which seemed to gain presidential attention and prompt a change in direction.

President Trump has now declared a 90-day suspension on the proposed reciprocal tariffs for a majority of countries, notably excluding China. Tariffs on Chinese goods, however, were increased to 125% on Wednesday.

In response to inquiries about his unexpected policy adjustment, President Trump commented, “I felt people were reacting excessively and becoming somewhat alarmed.”

For those just catching up, here’s a summary of the latest developments regarding Trump’s tariffs:

• Global markets rallied significantly as President Trump announced a 90-day pause on tariffs. The S&P 500 index jumped by 5.6%, and the Nasdaq Composite surged over 8%. President Trump’s statement on Truth Social indicated a temporary rollback of tariffs for most nations over the next 90 days, setting a 10% tariff rate for this interim period.

• Despite this general pause, China remains excluded. China has since declared new tariffs of 84% on all US imports, escalating from a previous 34%, enacted shortly after the US increased tariffs on Chinese products to a staggering 104%. China’s retaliatory measures intensified market declines, with key indices falling in major European economies, including the UK, Germany, France, and Spain.

• China’s newly imposed 84% tariffs on US imports are scheduled to take effect at 12:01 pm on Thursday, according to Xinhua, the state-run news agency.

• Both nations have engaged in a series of reciprocal tariff increases throughout the preceding week. “I want to reiterate that no one gains from a trade war, and it is not China’s objective. However, the Chinese government will not remain passive when the legitimate rights and interests of its people are compromised,” stated an official from China’s Ministry of Commerce on Wednesday.

• Addressing the press at the White House on Wednesday, Treasury Secretary Scott Bessent suggested that Donald Trump’s recent tariff adjustments were part of a premeditated strategy. He explained, “This was his intended approach from the beginning. One might even argue that he strategically provoked China into an unfavorable position, to which they then responded.”

• The World Trade Organization (WTO) Director-General cautioned that the ongoing US-China tariff conflict could lead to an 80% reduction in trade volume between these two major economic powers, thereby negatively impacting the global economy. Ngozi Okonjo-Iweala reiterated concerns about the severe economic repercussions of this trade dispute.

• The European Union (EU) has announced 25% tariffs on selected US imports as an initial countermeasure. The 27-member bloc has agreed to implement retaliatory tariffs on US goods valued at €21 billion (£18 billion), targeting agricultural products and goods from states with Republican political representation. Hungary was the only member state to oppose these measures, with all others voting in favor.

• It has emerged from a meeting between Ireland’s Deputy Prime Minister and US Commerce Secretary Howard Lutnick that President Trump’s 90-day tariff suspension might exclude the 25% tariff on automobiles. Simon Harris, the first EU representative to meet with a Trump administration official since the tariff announcements last Wednesday, reported discussing this with European Trade Commissioner Maroš Šefčovič immediately following his Washington discussions.

• President Trump has specifically targeted the pharmaceutical sector, stating, “We are going to impose tariffs on pharmaceutical companies, and they will all want to relocate production back here.” This is a proposition he has articulated previously.

• US markets showed recovery on Wednesday afternoon after Secretary Bessent indicated US willingness to engage in trade agreements with allied nations, potentially followed by a broader accord with China. In his first public statement since China’s announcement of 84% tariffs, President Trump advised Americans to “remain calm”. The US president had earlier boasted of nations “eager to please me” in trade negotiations during a dinner on Tuesday night.

Fueled by Donald Trump’s decision to shelve planned tariff hikes on most countries, excluding China, stock markets across the globe experienced a significant upswing. This 90-day tariff reprieve marks a retreat from his expansive trade war after days of significant market instability and growing recession concerns.

On Wall Street, the S&P 500 benchmark index surged by 9.5%, achieving its largest single-day increase since 2008’s financial crisis.

The Dow Jones Industrial Average rose sharply by 7.9%. The technology-heavy Nasdaq Composite index climbed by 12.2%, its best performance since 2001, with shares in tech giants such as Apple and Nvidia notably increasing.

Despite days of steadfastly defending his aggressive trade policy, President Trump shifted course, announcing that all nations that hadn’t retaliated against prior US tariffs would receive a temporary reprieve, facing a uniform 10% US tariff until July.

When questioned about the rationale behind this policy adjustment, the US president told reporters that “People were becoming overly reactive and agitated.”

However, as Beijing proceeds with plans to impose significant 84% tariffs on US goods starting tomorrow, Trump indicated he would escalate US tariffs on Chinese exports to 125%, effective immediately, signaling a continued tough stance against China amidst a fluctuating global trade landscape.