Financial markets surged on Wednesday following U.S. President Donald Trump’s announcement of a temporary pause on most trade tariffs. While the move excluded China, it provided enough relief to trigger a strong rally across both cryptocurrency and stock markets.
Trump took to Truth Social to declare a 90-day suspension of “reciprocal” tariffs on imports from several countries, stating that during this period, a reduced tariff rate of 10% would apply. The exception, however, was China, which will now face significantly higher import levies.
“I have authorized a 90-day PAUSE, and a substantially lowered reciprocal tariff during this period, of 10%, also effective immediately,” Trump wrote. “China remains excluded from this pause.”
The response from the markets was immediate. Bitcoin shot up by 4.6% within the hour, reaching $81,300, while Ethereum climbed 6.1% to $1,600. Ripple’s XRP saw an even more dramatic jump, soaring 10% to hit $2.03, according to CoinGecko data.
Stock markets reacted with equal enthusiasm. The S&P 500 and Dow Jones Industrial Average both surged more than 5%, while the Nasdaq, boosted by its tech-heavy makeup, leapt over 8%.
This announcement follows weeks of market anxiety fueled by escalating trade tensions. Investors had been spooked by the prospect of widespread tariffs increasing costs for consumers and businesses, and potentially slowing global economic growth.
China, however, was not spared. The president confirmed that Chinese imports would now be subjected to a steep 125% tariff, effective immediately. This move intensifies the ongoing trade standoff between Washington and Beijing, which has seen tit-for-tat levies on goods from both nations. In response, China imposed 84% tariffs on U.S. products earlier in the day.
Commenting on the policy shift, U.S. Treasury Secretary Scott Bessent offered reassurance. “I think now the market understands that everything they saw last Wednesday was a ceiling, and now we have a temporary floor,” Bessent said. “In my 35 years in the market, I always wanted certainty, and now I think we’ve got some certainty.”
Bessent also clarified that the decision to ease tariffs was not a direct reaction to falling stock prices but rather a diplomatic gesture toward U.S. allies who have “been operating in good faith.”
Meanwhile, the overall cryptocurrency market cap rose by 3.1%, reaching $2.63 trillion. This marked a modest recovery from the $2.74 trillion valuation before last week’s tariff announcement.
While China remains a major point of contention, Trump’s move to ease pressure on other trade partners has helped stabilize market sentiment—at least temporarily. Investors will be watching closely to see how the next three months unfold.