BREAKING: Trump Caves on Tariff Policy, Announces 90-Day Pause After Market Rout

In a major policy reversal, Donald Trump has announced a 90-day pause on his sweeping reciprocal tariff plan following a steep market decline and mounting investor concerns. The sudden shift comes after days of economic turbulence, with stocks plunging and fears of a broader slowdown intensifying.

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Effective immediately, all reciprocal tariffs will be capped at 10% for the duration of the 90-day period, representing a sharp departure from the aggressive trade posture Trump had previously embraced. The only exception is China, which will now face a dramatically increased tariff rate of 125%, reflecting ongoing tensions and a targeted pressure campaign by the Trump team.

The announcement follows a chaotic week on Wall Street. The Dow tumbled more than 2,000 points, and tech stocks saw heavy losses amid fears that escalating tariffs would drive up costs for consumers and disrupt global supply chains. Investors and business leaders had grown increasingly vocal in their criticism, warning that the tariff war was triggering market instability and threatening economic growth.

Despite the across-the-board reduction, consumer prices are still expected to rise on high-demand imports, particularly electronics such as iPhones and other devices manufactured in China. The punitive hike on Chinese goods means that the price pain for key categories is unlikely to ease in the short term.

The policy shift marks a clear retreat under pressure, as Trump faces backlash from both financial markets and political allies. The decision to leave China as the outlier suggests an attempt to maintain a hardline stance on a strategic rival while pulling back just enough to calm domestic economic fears.

Sources familiar with internal discussions say the move came after repeated warnings from top economic advisers and private urgings from major GOP donors, many of whom feared long-term damage to the economy and the party’s political standing.

The White House has not indicated what will happen once the 90-day window closes, only noting that the situation will be re-evaluated at that time.