In a dramatic policy shift on April 9, 2025, U.S. President Donald Trump announced a temporary suspension of new tariffs on multiple countries, a move that sparked a sharp rebound in global financial markets. The decision came in response to escalating economic uncertainty and widespread market instability following the administration's earlier imposition of sweeping trade tariffs.

The global stock market responded positively to Trump’s partial tariff rollback, reversing several days of steep losses. The S&P 500, which had plunged below the 5,000 mark and neared a bear market, rebounded on the news, regaining some of the $5.8 trillion in value that had been wiped out during the downturn. Analysts compared the market impact of the initial tariff shock to the turbulence seen during the early stages of the COVID-19 pandemic.

Despite the relief for many U.S. allies, President Trump reinforced his hardline stance on China by increasing tariffs on Chinese imports to a staggering 125 percent. In retaliation, China responded with an 84 percent tariff on American goods, significantly heightening tensions between the world's two largest economies. Meanwhile, a 10 percent general tariff remains in place on nearly all U.S. imports, and specific duties on steel, aluminum, and automobiles remain unaffected.

Canada and Mexico continue to face tariff pressure over U.S.-Mexico-Canada Agreement (USMCA) compliance issues, even though many other nations were temporarily spared. U.S. Treasury Secretary Scott Bessent defended the administration's approach, describing it as a strategic maneuver to force foreign governments into negotiations on trade reforms. President Trump also confirmed that talks are underway with over 75 countries and stated that while a resolution with China is possible, it is not the immediate focus of his administration.

The initial tariff rollout had caused widespread concern among investors and business leaders, as global supply chains faced renewed pressure and fears of a looming recession grew. China's firm retaliation and the mixed messaging from Washington further fueled market anxiety and raised doubts about future trade stability.

While the partial rollback offers some breathing room for global markets, the ongoing dispute with China and the unpredictability of future tariff decisions continue to cast a shadow over the global economic outlook. Economists warn that unless clearer and more stable trade policies are implemented, the uncertainty could hinder business investment and consumer confidence well into 2025.