Donald Trump has threatened that he could reimpose the full rate of his “reciprocal” tariffs if countries fail to strike a deal with the United States within 90 days.
London’s FTSE 100 closed 3 per cent higher as it rebounded somewhat alongside other European markets in Thursday’s trading, but Wall Street’s pain continued despite Mr Trump announcing the three-month pause in which most of his so-called “reciprocal” tariffs will remain at a blanket 10 per cent.
Although his threats continued on Thursday, the US president also signalled that he could be open to extending the pause, telling reporters: “We’ll have to see what happens at that time.”
But in what may be a blow to Sir Keir Starmer, Mr Trump’s trade adviser Kevin Hassett warned that the lower rate was likely to remain for most of Washington’s trading partners, telling CNBC: “It is going to take some kind of extraordinary deal for the president to go below [that].”
Mr Trump escalated his trade war with China further on Thursday, imposing tariffs of 145 per cent, while the European Union put its retaliatory measures on hold for 90 days to “give negotiations a chance”.
Dollar hits 10-year low against Swiss franc as markets digest trade war drama
The US dollar has hit a 10-year low against the safe-haven Swiss franc, as markets digested Donald Trump’s dramatic reversal on tariffs.
The greenback rebounded against the Swiss franc and Japanese yen on Wednesday, while Wall Street’s main stock indexes leaped as Mr Trump’s tariff climbdown brought some relief to investors.
But traders were readjusting their positions today, with the dollar dropping 2 per cent to 144.795 yen and 3.6 per cent versus the Swiss franc to 0.82635.
The dollar has fallen 3.46 per cent against the yen and nearly 6.5 per cent against the Swiss franc so far this month. It is on track for the biggest one-day loss against the franc since January 2015.
Trump-Truss comparisons are fair, says her ex-chancellor
Kwasi Kwarteng, who was chancellor under Liz Truss’s short-lived premiership, says comparisons between Donald Trump’s tariffs and her actions are fair.
Asked about comparisons on Sky News, he said: “I think they are fair.
“I think he’s gone full maximus in the way that we did, and what he’s trying to do is essentially reshape the world order, and he has taken the view… to just do everything at once, to create maximum disruption.
“And now he’s rowed back.”
He said, as in his experience under Truss, the bond markets “are the key”.
“That’s what’s going to be pushing up mortgage rates for his base,” he says.
“I think the yields were critical, because I don’t think he minds about the stock markets in the way that he would about the bond market.”
Mr Kwarteng said a “full-scale” trade war between the US and China would have an adverse effect on the global economy, adding it would “drag Europe down, and possibly us as well”.
Watch: Trump says he hasn’t seen today’s stock market slump
US and Vietnam to begin formal talks on trade, Washington says
The United States and Vietnam have agreed to begin formal discussions on reciprocal trade, Donald Trump’s Treasury secretary Scott Bessent has said, following a meeting with the Vietnamese deputy prime minister Duc Phoc.
In a statement, the US Treasury said: “During their talks, Secretary Bessent emphasised the importance of continued engagement with trade partners, and the need for quick, demonstrable progress to resolve outstanding issues.”
Vietnam was initially hit with a huge 46 per cent tariff on exports to the US – its largest export market – as part of Mr Trump’s so-called “Liberation Day” announcement, before the US president relented yesterday to reduce the levy to 10 per cent for 90 days.
Trump claims he could make ‘every deal in a day if I wanted’
Donald Trump has claimed that he could make “every deal in one day if I wanted to” – and warned that his higher “reciprocal” tariffs rate could return once the 90-day period ends.
Speaking to reporters following a cabinet meeting, the US president said: “We have to have a deal that we like. We don’t want a deal that’s going to be a bad deal. I could make every deal in one day if I wanted to. I could do this all in one day – I could say: ‘here’s what we’ll do’.”
Asked if the higher tariffs will revert if deals cannot be reached in 90 days, Mr Trump said: “That’s what will happen. If we can’t make the deal that we want to make or have to make, or that’s good for both parties – it’s got to be good for both parties – and then we go back to where we were.”
Pressed on whether he would extend the pause, he replied: “We’ll have to see what happens at that time.”
Trump says there will be ‘transition cost’ to tariffs policy
Donald Trump has claimed that “everybody wants to come and make a deal” with the United States, as he conceded there will be a “transition cost” to his tariffs policy.
Speaking after a cabinet meeting, the US president told reporters: “We have Scott [Bessent] here and Howard [Lutnick] and some of the people that are working on deals, and the biggest problem they have is they don’t have enough time in the day. Everybody wants to come and make a deal.
“We’re working with a lot of different countries, and it’s all going to work out very well. I think it’s going to work out all really very well. But we’re in good shape. There’s no inflation. There’s very little inflation. And I went four years without inflation. And tariffs. I took in hundreds of billions of dollars from China and others, taxes in China … and we had no inflation, essentially.
“So we think we’re in very good shape, we think we’re doing very well. Again, there’ll be a transition cost. And transition problems, but in the end it’s going to be a beautiful thing.”
EU and China commence talks on lifting tariffs on Chinese electric vehicles, report says
The European Union and China have begun negotiations on the abolition of EU tariffs on imports of Chinese electric cars, German newspaper Handelsblatt reports.
EU trade commissioner Maros Sefcovic met China commerce minister Wang Wentao during a visit to Beijing at the end of March and both sides agreed to resolve a dispute over EU tariffs through negotiations, according to the report.
The EU imposed tariffs on Chinese-made electric vehicles late last year, saying they were needed to counter cheap loans, land and raw materials and other subsidies and the goal was a level playing field, not shutting Chinese car makers out.
The European Commission has said it is willing to continue negotiating an alternative to tariffs with China.
Since imposing his so-called “Liberation Day” tariffs, Donald Trump and his team have sought to boast that the move has pushed America’s trading partners to seek closer ties with Washington at the expense of Beijing.
Don’t worry if your pension value has dropped
Trump says yesterday was ‘the biggest day in history’ after brief market turnaround
Donald Trump has claimed yesterday was “the biggest day in history” in an apparent reference to the market reaction to his decision to relent on his global trade tariffs.
Speaking after a cabinet meeting, the US president told reporters: “We had a very good meeting, we’re talking about a lot of different things. Consumer prices have actually dropped. There’s very little inflation. Everybody predicted a lot of inflation. Very little inflation. Energy costs are down, interest rates are probably down. They scatter but they’re probably down.”
He added: “We had a big day yesterday. There will always be transition difficulty. But we had a – in history, it was the biggest day in history. The markets. So very happy with the way the country’s running.
“We’re trying to get the world to treat us fairly. This is something that should have been done 25 years ago and it wasn’t. It should have been done 40 years ago and it wasn’t. No president was willing to take it on. But you had to. It wasn’t sustainable.”
Today, the S&P 500 slid 4.9 per cent and the Dow Jones dropped 4.2 per cent amid a sell-off after a rally in the previous session.
Armed forces chief visits China
The head of the British armed forces has visited China for the first time in a decade.
Admiral Sir Tony Radakin, below, discussed “issues of common concern” with China’s military leadership when he visited Beijing, according to China’s defence ministry.
General Liu Zhenli, a member of China’s central military commission, was among those who held talks with Sir Tony on Wednesday.
“The two sides conducted in-depth exchanges on China-UK relations and mil-to-mil relations, international and regional situations and issues of common concern, and had communication on strengthening exchanges and co-operation between the two militaries,” a readout of their meeting said.
The Chief of the Defence Staff also gave a speech to future Chinese military commanders, at the People’s Liberation Army National Defence University in Beijing, according to The Times.
Source: independent.co.uk
