World
Trump U-turns on tariffs but keeps trade war heat on China
U.S. President Donald Trump’s stunning decision to pause the hefty duties he had just imposed on dozens of countries sent battered global stock markets surging on Thursday even as he ratcheted up a trade war with the world’s No. 2 economy China.
Trump’s turnabout on Wednesday, which came less than 24 hours after steep new tariffs kicked in on most trading partners, followed the most intense episode of financial market volatility since the early days of the COVID-19 pandemic, Reuters reported.
The upheaval erased trillions of dollars from stock markets and led to an unsettling surge in U.S. government bond yields that appeared to catch Trump’s attention.
“I thought that people were jumping a little bit out of line, they were getting yippy, you know,” Trump told reporters after the announcement, referring to jitters sportpeople sometimes get.
U.S. stock indexes shot higher on the news, with the benchmark S&P 500 index closing 9.5% higher. Bond yields came off earlier highs and the dollar rebounded against safe-haven currencies.
The relief spread through Asian markets as they opened on Thursday with Japan’s Nikkei index surging 8% while European futures also pointed to a sharp rebound. Even Chinese stocks rose, propped up by hopes of state support, although its yuan currency fell to the lowest level since the global financial crisis.
Since returning to the White House in January, Trump has repeatedly threatened an array of punitive measures on trading partners, only to revoke some of them at the last minute. The on-again, off-again approach has baffled world leaders and spooked business executives.
U.S. Treasury Secretary Scott Bessent asserted that the pullback had been the plan all along to bring countries to the bargaining table. Trump, though, later indicated that the near-panic in markets that had unfolded since his April 2 announcements had factored in to his thinking.
Despite insisting for days that his policies would never change, he told reporters on Wednesday: “You have to be flexible.”
But he kept the pressure on China, the second biggest provider of U.S. imports. Trump said he would raise the tariff on Chinese imports to 125% immediately from the 104% level that took effect at midnight.
Beijing on Wednesday slapped 84% tariffs on U.S. imports to match Trump’s earlier tariff salvo and has vowed to “fight to the end” in an escalating tit-for-tat trade dispute between the world’s top two economies.
Chinese companies that sell products on Amazon are preparing to hike prices for the U.S. or quit that market due to the “unprecedented blow” from the tariff hikes, the head of China’s largest e-commerce association said.
‘GOADED CHINA’
Trump’s reversal on the tariffs imposed on other countries is also not absolute. A 10% blanket duty on almost all U.S. imports will remain in effect, the White House said. The announcement also does not appear to affect duties on autos, steel and aluminum that are already in place.
The 90-day freeze also does not apply to duties paid by Canada and Mexico, because their goods are still subject to 25% fentanyl-related tariffs if they do not comply with the U.S.-Mexico-Canada trade agreement’s rules of origin. Those duties remain in place for the moment, with an indefinite exemption for USMCA-compliant goods.
Trump’s tariffs had sparked a days-long selloff that erased trillions of dollars from global stocks and pressured U.S. Treasury bonds and the dollar, which form the backbone of the global financial system. Canada and Japan said they would step in to provide stability if needed – a task usually performed by the United States during times of economic crisis.
Analysts said the sudden spike in share prices might not undo all of the damage. Surveys have found slowing business investment and household spending due to worries about the impact of the tariffs, and a Reuters/Ipsos survey found that three out of four Americans expect prices to increase in the months ahead.
Goldman Sachs cut its probability of a recession back to 45% after Trump’s move, down from 65%, saying the tariffs left in place were still likely to result in a 15% increase in the overall tariff rate.
Treasury Secretary Bessent shrugged off questions about market turmoil and said the abrupt reversal rewarded countries that had heeded Trump’s advice to refrain from retaliation. He suggested Trump had used the tariffs to create maximum negotiating leverage. “This was his strategy all along,” Bessent told reporters. “And you might even say that he goaded China into a bad position.”
Bessent is the point person in the country-by-country negotiations that could address foreign aid and military cooperation as well as economic matters. Trump has spoken with leaders of Japan and South Korea, and a delegation from Vietnam met with U.S. officials on Wednesday to discuss trade matters, the White House said.
Bessent declined to say how long negotiations with the more than 75 countries that have reached out might take.
Trump said a resolution with China was possible as well. But officials have said they will prioritize talks with other countries.
“China wants to make a deal,” Trump said. “They just don’t know how quite to go about it.”
Trump told reporters that he had been considering a pause for several days. On Monday, the White House denounced a report that the administration was considering such a move, calling it “fake news.”
Earlier on Wednesday, before the announcement, Trump tried to reassure investors, posting on his Truth Social account, “BE COOL! Everything is going to work out well. The USA will be bigger and better than ever before!”
Later, he added: “THIS IS A GREAT TIME TO BUY!!!”
World
Iran awaits US move after WSJ report says Trump rejects peace plan
Iran on Saturday awaited an official US response to its proposal to reopen the Strait of Hormuz and end fighting in the wider Middle East war after the Wall Street Journal reported that US President Donald Trump had rejected the deal.
Iran raised the diplomatic initiative at the United Nations General Assembly in New York, saying it had been transmitted to the Americans via Qatari mediators and could reopen the strategic waterway and put an end to hostilities in the region within seven days, Reuters reported.
The Iranians also engaged their Saudi rivals regarding the strait, underscoring the stakes of a seven-month-old conflict that has disrupted oil flows through one of the world’s most critical shipping lanes and taken a toll on the global economy.
Iranian Foreign Minister Abbas Araqchi told reporters at the United Nations on Friday the deal would trigger a seven-day countdown to reopening the strait and a pause in regional fighting.
“If there is seriousness on the US side to come to a deal and reopen the Strait of Hormuz, everything is now prepared,” Araqchi said.
If the US were to agree, the warring parties could start wider talks “on mutually agreed subjects,” Araqchi said.
That could potentially include discussions of Iran’s nuclear program. Trump has vowed that Tehran will never acquire a nuclear bomb, while a senior Iranian official told Reuters that Iran will show no flexibility over its nuclear program even if the United States accepts its peace deal.
Iran would grant no concessions over its rights, including enriching uranium or shipping its highly enriched uranium out of the country, the official said.
Even so, Iran had put forward a plan that would halt hostilities on all fronts, including Lebanon. The plan in turn would require the United States to lift its blockade on Iranian ports, release Iran’s frozen funds, and waive its oil sanctions, Araqchi said.
A US official, speaking on condition of anonymity, had previously called discussions through mediators “positive and constructive.”
But Trump was privately skeptical that Iran would meet his demands, the Journal report said, and he told his staff that he sees a renewed bombing campaign as likely.
Reuters could not immediately confirm the Journal report.
SAUDI ALLIES UNITE
Previous attempts at diplomacy have failed to end the war, which began on February 28 with US and Israeli attacks.
Since then the war has alternated between pauses and renewed strikes, killing thousands while degrading Iran’s conventional forces and damaging Iran’s already ailing economy.
Iran and its allies have retaliated by extending the conflict throughout the region. Iran, which controls the strait along with Oman, has struck US allies in the Gulf with drones and missiles while its Houthi allies in Yemen have targeted Saudi interests. Iranian-aligned militias in Iraq were blamed for a pipeline attack that temporarily took more Saudi oil off the market. All the while, Iranian-backed Hezbollah has been engaged with Israeli forces in Lebanon.
Araqchi briefed his Saudi counterpart Prince Faisal bin Farhan on the understanding between Iran and Oman regarding safe shipping routes in the Strait of Hormuz, Iran’s foreign ministry said early Saturday.
The war’s widening toll has also united Saudi Arabia’s allies to shore up the kingdom’s defenses.
The Saudi-backed, internationally recognized Yemeni government has come under assault from Iran-linked Houthi fighters, with Houthi missiles striking inside the kingdom.
Yemen’s Saudi-led coalition said early Saturday it intercepted two drones launched by the Houthis towards the Saudi capital Riyadh in addition to intercepting a ballistic missile launched by the Houthis toward Khamis Mushait.
The Houthis, who control the most populous parts of Yemen and much of the north, have launched attacks against Saudi Arabia since declaring a naval blockade against Riyadh in July, with strikes targeting Saudi vessels in the Red Sea.
The attacks have targeted Saudi cities, energy infrastructure and shipping, adding to pressures on global oil supplies caused by the US-Israeli war on Iran and putting at risk the main alternative Red Sea route for Gulf exports while traffic through the Strait of Hormuz remains largely blocked.
Defense officials of Turkey and Pakistan, both partners in a joint defense pact with Saudi Arabia, met in Riyadh on Friday to review the security situation and discuss intelligence cooperation, military coordination, and integrating forces, the Saudi defense ministry said in a statement.
The statement came a day after Saudi, Pakistani and Turkish foreign ministers met within the framework of the Mecca Joint Defense Agreement.
The violence in Yemen has prompted a new humanitarian crisis, the United Nations children’s agency said on Friday, reporting a rise in acute malnutrition among children.
World
White House reinstates access to CNN, MS NOW and Politico following judge’s order
The White House said on Thursday it has reinstated journalists from CNN, MS NOW and Politico after a federal judge deemed US President Donald Trump’s ban of the three news outlets likely unconstitutional and ordered their access immediately restored.
The midday reinstatement came after a chaotic few hours earlier on Thursday when the journalists continued to be blocked from entering the White House grounds. That prompted the three news organizations to request an immediate hearing before US District Judge Tim Kelly, who issued his decision overnight, Reuters reported.
Kelly, acting in a lawsuit brought by CNN, MS NOW and Politico on Monday, ordered a halt to Trump’s ban for 14 days in a press freedom case that has played out over the past week in the courtroom and White House grounds.
Kelly found that the revocation of the White House credentials of the journalists “likely violated their constitutional due process rights.”
The judge, who Trump appointed in 2017 during his first presidential term, also raised doubts about the US Justice Department’s national security arguments for justifying the ban, noting that Trump himself had said the action was due to what the president alleged was false or negative coverage.
Hours after Kelly issued his order, CNN, MS NOW and Politico told the judge they remained barred, and asked for the emergency hearing. Politico said its reporter’s credentials were confiscated. An MS NOW reporter said she was blocked from the White House. CNN said some of its staff members were denied entry onto the grounds.
In response, Micah Stopperich, the director of press operations at the White House, said in a court filing that the White House began the process of reinstating press badges for affected reporters at 7:25 a.m., and that the “White House press team dropped badges at the entry gate for members of the press to pick up around 9:55 a.m.”
After receiving Stopperich’s declaration, the judge denied the request by the news organizations for an emergency hearing but gave them an opportunity to inform him of any factual developments later in the day.
The sharpest conflict yet between Trump and the press played out during a key diplomatic moment for the US president: his appearance at the United Nations General Assembly in New York and his hosting of Chinese President Xi Jinping on Thursday.
A source familiar with the White House television press pool said its members would not reinstate their coverage until the White House formally reinstates CNN to the pool. Earlier this week, they had suspended pooled coverage in solidarity with CNN.
There were no TV pool cameras set up for Xi’s arrival on the White House’s South Lawn on Thursday morning, and FOX News, MS NOW and CNN did not air the two leaders’ arrival ceremony live.
During Trump’s welcome of Xi to the White House, the president made a joke to photographers in the Oval Office about the Chinese having the friendliest press corps.
CNN is one of the five news organizations – along with ABC, CBS, FOX News and NBC – that make up the primary White House television pool. They share the costs of covering the president, take turns organizing coverage and provide footage to other outlets.
CNN had been scheduled to cover Trump’s trip to New York for the General Assembly on Monday, but was not able to provide a pool feed.
NATIONAL SECURITY CONCERNS
Trump announced the ban on Friday on his social media platform, saying those news organizations “shouldn’t be able to constantly write or report FICTION and LIES when they’re covering the President of the United States.” Trump framed their reporting as a threat to US national security.
The three outlets sued Trump and other members of his administration, saying the ban violated the US Constitution’s First Amendment protections for free speech and a free press, as well as their due process rights. A coalition of press freedom groups and dozens of news organizations, including Reuters, later filed a legal brief supporting the three news outlets.
Kelly ordered the Trump administration to immediately return the outlets’ press passes and stop enforcing the ban for two weeks. The judge rejected the administration’s stated national security concerns.
“The record lacks factual support for defendants’ contention that the revocation of plaintiffs’ hard passes will in fact protect national security or that national security will be endangered if the court orders their passes reinstated while this litigation proceeds,” Kelly wrote.
In a filing on Tuesday, the Justice Department accused the outlets of threatening national security with their coverage, citing stories about US missile stockpiles, construction of Trump’s White House ballroom and turnout at the recent Republican midterm convention.
Theodore Boutrous, an attorney for the three outlets, welcomed the judge’s decision in a statement, saying: “This is a strong ruling vindicating freedom of the press, due process and the rule of law. We greatly appreciate the court’s swift action.”
TENSIONS WITH THE PRESS
Although other presidential administrations have battled with the press, Trump’s campaign against the media has been unprecedented. Upending decades of tradition, his White House had denied basic access to many major news organizations, launched personal attacks on journalists and filed multiple lawsuits against news organizations.
Kelly’s ruling came a day after Trump experienced another legal setback.
On Wednesday, an Iowa judge dismissed Trump’s 2024 lawsuit against the Des Moines Register newspaper and pollster J. Ann Selzer. Trump sued the Register, its parent company Gannett and Selzer over a poll published ahead of the November 2024 US election that showed Democratic presidential candidate Kamala Harris leading him in Iowa. Trump accused the newspaper and its longtime pollster of fraudulently misleading readers.
In his ruling Wednesday, Iowa District Judge Scott Beattie said the poll was legally protected speech.
World
Trump welcomes Chinese President Xi as US-China summit gets underway
WATCH: ▶️ Trump’s decision to meet Xi at Joint Base Andrews airport marked the first time since 1962 that a US president has personally welcomed a foreign leader at the base.
US President Donald Trump welcomed Chinese President Xi Jinping to Washington with a high-profile military ceremony, as the two leaders begin a three-day summit focused on trade, technology and other major areas of tension between the two countries.
Xi arrived at Joint Base Andrews in Maryland on Wednesday evening, where Trump and First Lady Melania Trump personally greeted him and his wife, Peng Liyuan.
The Chinese leader was welcomed with a red carpet, a military honor guard, marching band and a flyover by two US B-1 bombers. Trump’s decision to meet Xi at the airport marked the first time since 1962 that a US president has personally welcomed a foreign leader at the base.
Xi’s visit to Washington is his first since 2015 and comes as the two countries seek to maintain a fragile trade truce.
US Treasury Secretary Scott Bessent said on Wednesday that Washington and Beijing had agreed to extend their current trade truce until January. The arrangement had been due to expire on 10 November.
The agreement has involved the US lowering tariffs on some Chinese goods in exchange for China easing restrictions on exports of rare earth minerals.
Bessent said discussions with Chinese Vice Premier He Lifeng also covered the possibility of reaching a broader trade agreement.
In a statement carried by China’s state news agency Xinhua, Xi said the US and China should be “partners rather than rivals”, adding that cooperation between the two countries could benefit the world.
The summit is expected to address a wide range of issues, including trade and tariffs, rare earth minerals, agricultural exports, artificial intelligence, Taiwan and the ongoing conflict involving Iran.
Trump is expected to seek increased Chinese purchases of US agricultural products, greater access to Chinese rare earth minerals and lower Chinese tariffs on American goods.
Taiwan is also expected to feature in the talks, with Beijing opposing US arms sales to the self-governing island.
Xi is travelling with senior Chinese officials including Cai Qi, a member of the Communist Party’s Politburo Standing Committee, Vice Premier He Lifeng and Foreign Minister Wang Yi.
The Chinese president is expected to attend a state dinner at the White House on Thursday, with leaders from the US artificial intelligence industry among the guests.
The two countries are competing for greater influence in AI, while also debating the regulation and potential risks associated with the technology.
Xi’s visit will conclude on Friday.
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