President Trump announced plans to temporarily halt the country-specific reciprocal tariffs for 90 days, except for the tariffs on China. Following the announcement, the White House clarified that all countries’ reciprocal tariffs will be brought down to the 10% baseline rate, except for tariffs on China, which currently sit at a rate of 145% at the time of this newsletter issue. In retaliation, China has continued to raise reciprocal tariffs on U.S. products, now at 125% from their previous 84% rate. Last month, Trump signaled that the machines used to make semiconductors and consumer electronics (smartphones, computers, etc.) made in China would be exempt from U.S.-imposed tariffs. All this comes after the “Liberation Day” announcement of the widespread global reciprocal tariffs earlier this month, which triggered large swings and turmoil in the stock and bond markets.

President Trump and Department of the Treasury Secretary Scott Bessent, who is expected to help lead trade negotiations, relayed that more than 75 countries have come to the negotiating table and are willing to secure lower duties. The tariffs placed on Mexico and Canada have remained unchanged from their previous settings, which means United States-Mexico-Canada Agreement (USMCA) compliant goods will continue to see a 0% tariff, non-USMCA compliant goods will see a 25% tariff, and non-USMCA compliant energy and potash will see a 10% tariff, as well as the 25% tariff on all foreign automobiles.

As more trading partners come to the table during this time, the Trump Administration’s trade goals of eliminating trade barriers, both on tariffs and regulations, and reversing the U.S. trade deficit seem to remain at the center of negotiations. After the 90-day pause was announced, the European Union (EU) declared its pause on pending retaliatory tariffs. Before being paused, the EU planned to impose duties of up to 25% on about $23 billion in U.S. exports. The tariffs targeted soybeans, poultry, nuts, and other agricultural products. Members of the EU have indicated they will negotiate with the U.S. and hope to avoid implementing retaliatory tariffs moving forward.