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Trump’s sudden announcement Wednesday that he temporarily interrupted his tariff plan surprised the world – as well as most of its allies and administration -.
The announcement has given foreign leaders some relief, with a new deadline of July 8, which is now set, so that trade on affected countries and US can be negotiated. It follows days of chaos in the global markets, with shares in such an abroad that even billionaire business owners get the jitters.
Here’s what you need to know about what’s going on:
Why did Trump interrupt his rates for 90 days?
Trump and his allies predictably claimed that the surprise U-Turn was part of the plan “all the time.”
“I thought people jumped out of line a bit. They became Yippy, you know, they became a little Yippy, a little scared, “was the reason for the Switch that the president told reporters on Wednesday, and later added that the move” came from his heart “.
But according to multiple sources, the decision came after days of looking at the global markets in chaos, as well as the falling value of the dollar – while the financial industry leaders and even members of his own party expressed concern.
According to The Washington PostTrump discussed the situation with a group of Republican senators on Tuesday night after seeing them on Fox News. He also had a call with the president of Switzerland, and he looked at Jamie Dimon, CEO of the largest bank of the America – who previously supported him – that a recession was “probably”.
A few hours later, Trump wrote, which characterized Howard Lutnick, secretary of trade, as “one of the most extraordinary truth positions of his presidency” and temporarily reversing his striking levies.
What happens after 90 days?
Trump has not yet said exactly what will happen after his 90 -day break, which lasts until July 8.
In his truth, Social Post announced the break, the president said that more than 75 countries are issuing his administration to mediate trade transactions. The extra time can enable these countries to negotiate specific trading transactions.
When the time is over, those who have not yet negotiated may again be at the grace of the same rates that Trump imposed on April 9.
However, the president may also have announced another tariff postponement earlier this year after delaying the rates on two of the country’s most important trading partners – Canada and Mexico.
The independent came out to the White House for explanation about what happens after the break ended.
Will prices continue to rise? (And on what products?)
Despite temporarily reversing the majority of his “reciprocal rates”, Trump said all trading partners would still charge with a 10 percent blanket.
According to the estimates of the University of Yale, food prices will increase by 2.5 percent in the short term from the short term rates. Fresh products will initially rise by 5.4 percent, but according to the report, stabilizes at 3.7 percent.
The price of imported foods such as coffee, fruits, cheese, nuts and seafood is likely to rise.
Consumers will also face high increases in clothing and textile prices in the short term, reports the budget laboratory, with a 58 percent price increase for clothing and 40 percent for textiles. However, after a switch to cheaper alternatives, prices will fall – although it remains at 26 percent higher for clothing and 17 percent higher for textiles.
Elsewhere, other rates, including a 25 percent levy on all foreign -manufactured vehicles, which started on April 3, will remain in their place, as well as a similar one that will be loaded on auto parts on May 3.
This means a 13 percent price increase in motor vehicles in the short term and 18 percent in the long run. The Budget Laboratory estimates that the latter is the equivalent of an extra $ 8,700 to the price of an average 2024 new car.
How does it affect businesses, big and small?
Even despite the break, which briefly protects companies from most of the rates, it is more likely to experience small businesses the effects of the 10 percent baseline levies and the fallout of haunted customers.
Such businesses, which are normally defined as those with less than 500 employees and revenue of less than $ 7.5 million, will be confronted with the choice to raise prices to match the new charges or take the hit themselves.
Emily Ley, owner of online stationery companies, simplified – which manufactures its products in China – told CBS that the reciprocal rates and additional tax burden were “catastrophic” for her business. “There is a limit to how much our prices can raise before we price ourselves from the market,” she said.
Ley has filed a case against the rates administration, arguing that Trump has used emergency forces illegally to impose it.
In the aftermath of the market uncertainty already caused by Trump’s Yo-Yo-In-Sing, customers are increasingly cautious with their money.
Although baseline tariffs can be recorded more easily by giant chains such as Walmart and Costco, large brands that rely on foreign manufacturers can eventually be forced to bring their means of production back to the US, which cost money and time.
Was this market manipulation or domestic trade?
Shortly before his dramatic pivot, which rose stock markets to record, wrote on Truth Social: “It’s a good time to buy !!”
It did not take long for social media to break out with accusations that the president played a reverse ‘pump and shower’ scheme with the US economy, while Democrats accused him of market manipulation.
The accusation is that Trump’s tariff increases and a hard attitude about world trade with US depressed global stocks, allowing people to buy if the markets were low before they suddenly turned the rate and the stock prices on stage.
Democratic Senator Adam Schiff said the major trade policy changes “offer dangerous opportunities for insider trading” and ask for an investigation to be investigated. Economic experts also shared their concerns.
The government has denied any offense.
When asked why he flew back on his tough rates and greatly interrupted their launch for 90 days, Trump replied: “I thought people were jumping out of the line a bit.”
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