The White House has released a surprising post by President Donald Trump about X (formerly Twitter). Tariffs on both sides were suspended comprehensively for 90 days, trade negotiations continued, and tariff levels fell to 10% overall.
A White House spokesman confirmed that “private negotiations will continue,” during which time, that most sector and national tariffs will close at a base rate of 10% and will soon be in effect. The temporary measures include major trading partners such as Canada and Mexico.
The White House said in a separate statement that encouraging more constructive dialogue is part of a strategic reorganization. However, the exact nature of the tariffs remained unknown, causing confusion among economists and market participants.
Analysts warned that the move could only provide temporary relief. “The suspension of tariffs is good news, but there’s only 90 days. This trade war is never over. Uncertainty can make decisions difficult for businesses planning a few months in advance.”
Stadele also pointed out that CME’s Emini S&P 500 futures trading volume ahead of the announcement, and investors were hesitant to commit in either direction.
FX Managing Director Amarjit Sahota reflects similar concerns. “The market may have responded proactively in the short term, but this 90-day delay brings more uncertainty. This appears to be a rushed political manipulation rather than a sound economic strategy.”
Steve Sosnick, the Chief Market Strategist of Interactive Brokers, called the decision a “surprise.” In particular, given the previous company’s attitudes by US officials declaring non-negotiable tariffs, “Uncertainty has decreased, but it has not disappeared.”
Nouriel Roubini, an economist called “Dr. Doom,” for correctly predicting the 2008 financial crisis, warned that the Fed is unlikely to act as a buffer for Trump’s tariff operations. “There’s a calculation between the bottom of Trump and the bottom of Powell,” Rubini said. “But Powell will wait for Trump to flash first.”
Rubini believes the Fed is likely to stabilize interest rates despite rising market expectations for multiple interest rate cuts.
*This is not investment advice.
