Trump’s Tariff Shock: China Pays Huge, 75 Countries Get a Deal – Markets Respond

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President Trump has dramatically raised tariffs on China to 125% while reducing them to 10% for 75 countries that chose not to retaliate. Markets soared on the announcement, signaling cautious optimism.

Key Facts:

  • Trump tariffs China: Tariffs on Chinese goods raised to 125% after China hiked its levy on U.S. products from 34% to 84%.
  • Trump reduces tariffs on countries: Seventy-five countries that did not retaliate against U.S. tariffs will now face a lower 10% tariff rate.
  • 90-day negotiation window: These 75 countries have a 90-day window to renegotiate trade terms with the U.S.
  • Stock market surge on tariff news: The Dow Jones and major indexes soared following Trump’s announcement.
  • Scott Bessent backs policy: Treasury Secretary says tariffs aim to prioritize “Main Street” over Wall Street.

The Rest of the Story: A New Phase in Trump Tariffs Strategy

President Trump announced a two-pronged shift in trade policy on Truth Social.

On one hand, he lowered tariffs to 10% for 75 countries that declined to retaliate against the U.S.

On the other, he dramatically raised tariffs on China to 125%, effective immediately.

China had recently escalated the trade dispute by increasing its own tariffs on American goods from 34% to 84%.

Trump’s response came with a strong message: “The days of ripping off the U.S.A. are no longer sustainable or acceptable.”

In contrast, the non-retaliatory nations will have 90 days to negotiate new trade deals under friendlier terms.

The decision triggered an immediate positive response in financial markets.

The Dow Jones and other major indexes surged on the announcement, reflecting investor hope that targeted relief and tougher action against China could stabilize global trade tensions.

Commentary: Trump’s Trade Playbook Begins to Pay Off

President Trump’s tariff move is a clear sign that his strategy is yielding results.

By rewarding countries that showed restraint and punishing China’s aggressive stance, he’s shifting the global trade balance in America’s favor.

This isn’t just about tariffs—it’s about leverage.

The temporary reduction to a 10% tariff for 75 nations opens a peaceful door to renegotiation.

These countries now have a reason to engage rather than escalate.

It’s a smart tactic: offer incentives for cooperation while isolating the bad actor—in this case, China.

Beijing, meanwhile, continues to double down, but it may not be able to hold the line for long.

China’s economy has slowed, and sustained trade tensions with the U.S. could deepen its economic troubles.

They’re facing pressure from within and without, and Trump’s bold 125% tariff accelerates that pressure.

Treasury Secretary Scott Bessent articulated the broader vision.

This policy isn’t just a trade tactic; it’s part of a larger shift toward supporting small businesses and everyday Americans.

As Bessent put it, “It’s Main Street’s turn.”

By prioritizing capital access for smaller players and cutting bureaucratic red tape, the Trump administration is setting the stage for a more locally rooted economic revival.

Of course, volatility will remain in the markets as these policies unfold.

But today’s surge shows that investors are betting on Trump’s hand.

And if China eventually bends, Main Street—and America—could emerge stronger.

The Bottom Line: U.S.-China Trade War Enters New Territory

President Trump’s tariff strategy has taken a sharp turn—pressuring China harder while easing terms for cooperative countries.

Markets are responding positively, but all eyes will remain on how Beijing reacts.

If the pressure holds, this could mark the beginning of a major U.S. trade realignment.

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