Trump Announces Imminent Tariff Agreement, 90-Day Pause on 10% Tariffs

U.S. President Trump has announced that the first tariff agreement is very close to being reached. This development comes as the administration has been working to reassure investors and the public that the trade situation will improve. Treasury Secretary Scott Bessent expressed confidence that the U.S. would achieve "great certainty" after the 90-day pause on steep tariffs, during which the administration aims to negotiate new trade deals with its partners. This pause, instituted on Liberation Day, has been seen as a temporary measure to allow for negotiations while avoiding immediate retaliatory actions from other countries.

The baseline tariff rate of 10%, which went into effect on April 5, is expected to remain in place for most nations as part of any negotiated trade deals. This tariff rate is significantly lower than the 145% tariff rate that the White House has clarified is currently in effect on Chinese imports, a figure that was previously misreported as 125%. The administration has indicated that it is not currently considering any exemptions regarding tariffs.

The United States–Mexico–Canada Agreement (USMCA) remains a key component of the administration's trade strategy. Under this agreement, compliant goods traded among the three countries are imported tariff-free, while non-compliant goods face a 25% tariff. Energy and potash are exceptions, with a 10% tariff applied to these commodities. The administration's approach to tariffs has been multifaceted, with the U.S. imposing tariffs on dozens of countries, with the average tariff rate being 29% and some as high as 40%. The full list of affected countries and their respective tariff rates has been posted on the White House website. This move has been seen as a significant escalation in the ongoing trade war, particularly with China, where tariffs have been increased to 104% on certain goods.

The administration's strategy appears to be aimed at leveraging tariffs as a negotiating tool to secure more favorable trade terms. By imposing high tariffs on imports, the U.S. seeks to compel other nations to engage in negotiations and potentially form a united front against China. This approach has been met with mixed reactions, with some nations reaching out to others to form alliances in response to the U.S. tariffs. The administration's efforts to reach a trade deal come at a time when global trade tensions are at a high point. The 90-day pause on tariffs is seen as a critical window for negotiations, during which the U.S. hopes to achieve a first deal on tariffs. The outcome of these negotiations will have significant implications for global trade and the U.S. economy, as the administration seeks to balance its trade policies with the need for economic stability and growth.