Trump Tariffs Highlights: US consumer sentiment plummets to 1952 levels as trade war with China continues to escalate

US stock markets fell sharply on Thursday as investor anxiety escalated over the broader economic fallout from President Donald Trump’s ongoing tariff battles, as per Reuters.

The sharp selloff took away much of the momentum gained in the prior session, with all three major indices posting major declines. Hopefulness sparked by encouraging economic indicators and trade discussions between the US and Europe was overshadowed by the intensifying standoff between Washington and Beijing.

Just a day before, markets had surged following Trump’s announcement of a 90-day pause on new tariffs. The S&P 500 had recorded a 9.5% rally—its strongest single-day gain since October 2008—while the Nasdaq skyrocketed by 12.2%, marking its second-largest daily increase in history.

Trump is not ruling out the possibility of extending the 90-day pause he imposed on his “reciprocal” tariffs yesterday. According to reports during a Cabinet meeting, Trump told a reporter that if he is unable to secure the deals he seeks with U.S. trading partners, tariffs will return to their higher rates after the pause ends.

He added, “That’s what would happen, It’s got to be beneficial for both parties.” However, when asked if this meant he would not extend the pause, Trump replied, “We’ll have to see what happens.”

“Higher tariffs would go back in place if trade deals are not made…First deal on tariffs very close. Not considering exceptions…Would use money from tariffs to pay down debt,” reports quoted the President as saying.

According to a CNBC report, US President Donald Trump predicted that there would be “a transition cost and transition problems” while discussing his tariff polices during a Cabinet meeting. He however insisted that “we think we’re in very good shape.” The president also claimed that the US was raking in billions of dollars each day as a result of his protectionist policies.

US President Donald Trump has temporarily paused reciprocal tariffs for for all countries except China (including Hong Kong and Macau). An executive order released late on Wednesday suggested that the previously outlined tariffs would be paused till July 9. However the 10% baseline tariff imposed on countries will continue to remain in place. Reports citing experts also indicate that a 25% duty on steel, aluminium (effective from March 12) as well as the auto tariffs (from April 3) will continue.

US President Donald Trump has released a fresh executive order suspending the 26% reciprocal tariff against India till July 9. However the 10% baseline tariff imposed on countries will continue to remain in place. Reports citing experts also indicate that a 25% duty on steel, aluminium (effective from March 12) as well as the auto tariffs (from April 3) will continue.

In the first remarks since Trump announced a 90-day pause on some tariffs, Fed officials made no mention of the shift, but emphasized what they had before – that the tariffs still in place had already raised the risks of simultaneously higher inflation and slowing growth.

“It appears as though we have seen a marked increase in the upside risks around inflation along with elevated downside risks to the outlook for employment and growth,” Kansas City Fed President Jeff Schmid said on Thursday. “With renewed price pressures likely, I am not willing to take any chances when it comes to maintaining the Fed’s credibility on inflation.”

Dallas Fed President Lorie Logan, in comments to a Peterson Institute for International Economics event on trade and immigration, made a similar point.

“To sustainably achieve both of our dual-mandate goals, it will be important to keep any tariff-related price increases from fostering more persistent inflation,” she said. “For now, I believe the stance of monetary policy is well positioned.”

Former Treasury Secretary Janet Yellen told CNN that Trump’s chaotic tariffs were the “the worst self-inflicted wound that I have ever seen … imposed on a well-functioning economy.” She also noted that while it was a “relief” to have the levies paused, ““the US and global economies have suffered a huge protectionist shock.”

“I’m afraid I could not give it a passing grade,” she said in her first comments.

Dow falls over 2000 points, S&P 500 loses 6% as stock market wipes out majority of historic rally. Meanwhile NASDAQ extended losses to 7%.

Losses for stocks accelerated after the White House clarified that Chinese imports will be tariffed at 145 per cent, not the 125 per cent rate that US President Donald Trump had earlier written about.

US President Donald Trump has announced announced a separate duty on low-value packages imported from China in his latest executive order — the third change in about eight days. The so-called de minimis tariff exemption had previously allowed online retailers such as Temu, AliExpress and Shein a major advantage over competitors. US-bound packages from China that are valued at $800 or less will face a 120% tariff rate from May 2.

Dow plunges over 1700 points, S&P 500 tumbles nearly 5%, Dollar index weakens 1.8

Gold prices jumped nearly 3% to an all-time high on Thursday, as a drop in the dollar and an escalating trade war between the U.S. and China drove investors towards the safe-haven allure of the precious metal. Spot gold climbed 2.8% to $3,168.26 an ounce at 11:32 a.m. ET (1532 GMT), after hitting a record high of $3,171.49 earlier in the session. U.S. gold futures rose 3.5% to $3,185.50.

The Dow Jones Industrial Average dropped over 1,200 points while the S&P 500 shed 3.58% and the Nasdaq Composite slid 4.25%.

White House officials told CNBC that the tariffs against China now total 145% after the last hike announced by Donald Trump. The President had raised the reciprocal tariffs against Beijing to 125% on Wednesday afternoon. But this is in addition to a 20% fentanyl-related levy that he had imposed on China.

Goldman Sachs on Thursday cut its estimate for automobile sales in the U.S. for this year by nearly 1 million units, as President Donald Trump’s tariffs make it more expensive to buy a vehicle.

While Trump on Wednesday halted reciprocal tariffs on countries, barring China, for 90 days, the announcement did not appear to affect duties on autos, steel and aluminum, leading to concerns around increased costs for the sector.

“We believe the tariffs as proposed will raise the cost of both importing and manufacturing vehicles in the U.S. by at least a low to mid single digit thousand dollar level on average,” said Goldman Sachs analysts led by Mark Delaney.

However, it will be hard for the auto industry to completely pass on this additional cost to customers, especially with softening demand, the brokerage added.

(via Reuters)

European markets rose sharply on Thursday following a 90 day tariff pause. The pan-continental STOXX 600 index was last up 5.3%, on track for its biggest one-day gain since March 2020. Major indexes in London, Paris and Frankfurt were up between 4.6% and 5.7%.

Wall Street’s main indexes fell on Thursday, coming off a blistering rally following U.S. President Donald Trump’s move to temporarily lower the heavy tariffs on dozens of countries.

The U-turn came less than 24 hours after the new tariffs took effect on most trading partners, lifting the S&P 500 to its biggest single-day percentage gain since 2008 on Wednesday. The Nasdaq posted its biggest one-day jump since 2001.

” Just out: INFLATION IS DOWN!!!” read a short Truth Social post from the POTUS.

China has rejected what it called threats and blackmail from Washington. Commerce Ministry spokesperson He Yongqian told a regular press briefing that Beijing would “follow through to the end” if the U.S. persists. China’s door was open to dialogue, but this must be based on mutual respect, the ministry said.

Beijing may again respond in kind after already imposing 84% tariffs on U.S. imports on Wednesday to match Trump’s earlier salvo.

Trump, who claims the tariffs aim to fix U.S. trade imbalances, said a resolution with China on trade is also possible. But officials have said they will prioritize talks with other countries as Vietnam, Japan, South Korea and others line up to try and strike a bargain.

China’s yuan hit its lowest against the dollar on Thursday since the global financial crisis.

U.S. consumer prices unexpectedly fell in March, but inflation risks are tilted to the upside after President Donald Trump doubled down on tariffs on imported Chinese goods even as he lowered duties on other nations.

The consumer price index dipped 0.1% last month after gaining 0.2% in February, the Labor Department’s Bureau of Labor Statistics said on Thursday.

The decline likely reflected lower energy costs and the fading effects of beginning of the year price hikes.

In the 12 months through March, the CPI advanced 2.4% after rising 2.8% in February. Economists polled by Reuters had forecast the CPI edging up 0.1% and climbing 2.6% year-on-year.

Excluding the volatile food and energy components, the CPI gained 0.1% in March after climbing 0.2% in February. The so-called core CPI inflation increased 2.8% year-on-year in March after rising 3.1% in February.

March’s data likely captured only a fraction of the first wave of Trump’s barrage of import duties, including a 20% tariff on Chinese goods, and levies on steel and aluminum.

(via Reuters)

Oil prices retreated by more than 2% on Thursday as fears of a deepening U.S.-China trade war and a possible recession eclipsed earlier relief created by President Donald Trump’s announcement of a 90-day pause on some tariffs against most countries.

Brent futures fell $1.77, or 2.7%, to $63.71 a barrel by 1213 GMT. While U.S. West Texas Intermediate crude futures dropped $1.77, or 2.84%, to $60.58.

The retreat followed a volatile session on Wednesday, when crude benchmarks, which had tumbled as much as 7% earlier in the day, ended around 4% higher following Trump’s announcement of a pause on reciprocal tariffs on most countries, though he maintained a baseline tariff rate of 10%.

(via Reuters)

White House press secretary Karoline Leavitt claimed on Thursday that the President’s abrupt reversal on tariffs was all “the art of the deal” — a reference to the book Trump ghostwrote in 1987.

Meanwhile Economic Adviser Kevin Hassett insisted that it had been necessary for Trump to create leverage in order to begin the negotiations. The POTUS, he reiterated, had never had any other intent than getting people to the table.

White House Economic Adviser Kevin Hassett said he would ‘present a list of deal priorities to Donald Trump on Thursday. He also indicated that the US government ‘had offers from 15 countries’.

White House Economic Adviser Kevin Hassett said that talks with China were ‘likely to happen’ but added that there was no clarity about ‘when’ it would be possible.

White House Economic Adviser Kevin Hassett said that negotiations were ‘doable’ within the 90-day timeline. He also told CNBC during an interview that there were close to 20 countries that were currently making offers.

“We’ve got few deals we’ve been working on ahead of pause announcement. A few trade deals really well advanced…We have set up a process for tariff deals can be orderly,” he said.

“Two trade trade deals almost closed’ as of last week. There’s a big inventory of deals that are right close to the finish line,” he added.

Chinese authorities have indicated that it will “appropriately reduce” the import volume of American films amid an escalating trade war. A spokesperson for the National Film Administration said the “erroneous actions of the US government in wantonly imposing tariffs on China will inevitably further reduce the goodwill of domestic audiences towards American films”.

The European Union has agreed to a 90-day pause in countermeasures (due from April 15) following a similar announcement from Donald Trump. European Commission president Ursula von der Leyen said the bloc was “ready to make deals with US”. The top official however insisted that all options remained on the table.

“All options remain on the table. Preparatory work for further countermeasures continues. If negotiations are not satisfactory our countermeasures will kick in,” reports quoted her as saying.

The “Magnificent Seven” stocks amassed more than $1.5 trillion in market value on Wednesday after U.S. President Donald Trump paused his sweeping tariffs for 90 days, easing pressure on tech giants that had tumbled in recent sessions.

The gains did not erase the $3.4 trillion in value the companies have collectively shed since their peak in late 2024, with some $2 trillion of those losses coming since last week after Trump slapped tariffs on imports from countries including major tech market and exporter China.

But the reprieve gave investors a reason to buy back these expensive stocks, whose valuations had reached stratospheric levels as the companies bet billions of dollars on building out artificial-intelligence infrastructure.

According to a Reuters update quoting diplomats, the European Union is considering a 90 day pause for its countermeasures after Trump temporarily lowered the hefty duties he had just imposed on dozens of countries.

The bloc was due to launch counter-tariffs on about 21 billion euros of US imports from next Tuesday in response to Trump’s 25% tariffs on steel and aluminum. It is still assessing how to respond to US car tariffs and the broader levies.

China’s yuan hit its lowest against the dollar on Thursday since the global financial crisis, with the central bank cutting guidance for the sixth successive trading session amid an intensifying Sino-U.S. trade war.

Beijing has imposed steep tariffs on U.S. imports in response to similar U.S. action. Though U.S. President Donald Trump said he would temporarily lower duties recently imposed on dozens of countries, he increased those on Chinese goods.

A weaker yuan would make Chinese exports cheaper and alleviate tariff impact on the economy. However, a sharp decline could also increase unwanted capital outflows and risk financial stability, analysts and economists said.

The central bank will not allow sharp yuan declines and has instructed major state-owned lenders to reduce dollar purchases, people with knowledge of the matter told Reuters.