Trump stops tariffs: A retreat with global consequences for the economy!

Trump stops tariffs: A retreat with global consequences for the economy!

On April 10, 2025, US President Donald Trump announced a comprehensive decision on customs policy. He ordered a 90-day pause on new tariffs and lowered the rate of new tariffs. This measure affects most countries while the conflict with China, which remains the main focus, continues. Fox financial analyst Charles Gasparino emphasizes that the pullback is not a result of strategic considerations, but was influenced by dwindling confidence in the US economy.

However, the international reaction to this new tariff policy shows that many markets are vigilant. In Japan, for example, there were massive sell-offs of government bonds, indicating liquidity problems and reduced confidence. Gasparino emphasizes that the delay was necessary to prevent intervention by the Federal Reserve. Analysts are relieved by the decision as it could calm financial markets even as uncertainty remains.

Consequences for the global economy

Trump's decisions also have an impact on international markets. On April 8, 2025, prices had fallen worldwide and fears of a global economic crisis were growing. Ulrike Malmendier, a German economist, is critical of the developments and warns that the tariffs could have far-reaching negative consequences for the US economy. Their assessments suggest that it is less likely that tariffs will be eliminated than that the current policy line will continue.

In the long term, tariff policy could increase the inflation rate in the USA as consumers expect higher prices for consumer goods. German automobile manufacturers are particularly affected by these measures, as they are coming under pressure from tariffs on motor vehicles and vehicle components. This situation leads to higher prices on the US market and could jeopardize the competitiveness of German vehicles. The EU has reacted and announced that it will carry out an analysis of the affected product groups. It also reserves the right to take countermeasures in the form of countervailing duties on US products.

Political and economic effects

The long-term structural risks of Trump's tariff policy are being discussed in many places. Developing countries that rely heavily on the U.S. market could also suffer from economic instability. The Federal Reserve faces the challenge of fighting inflation without slowing economic growth. Some analysts warn that if developments do not stabilize, the current situation could reach the scale of the 2008 financial crisis and the Great Depression of 100 years ago.

The political implications are equally clear. Trump's tariff policies aim to mobilize his electorate, but could also lead to isolation from global markets and innovation flows. The coming months will be crucial to see whether the withdrawal from free trade was a calculated decision or whether it actually has serious consequences for the global economy.

Overall, it remains unclear whether the negotiations will lead to a positive result within the next 90 days. As markets react to current decisions in the short term, economists and politicians are concerned about further developments that could affect both the US economy and global trade relations.