EU welcomes Trump's 90-day tariff suspension, China excluded but markets rally

As President Trump announced a 90-day suspension of tariffs on US allies – excluding China – Europe has cautiously welcomed the move, seeing it as a potential window to de-escalate a spiralling trade conflict.

The European Union has cautiously welcomed President Donald Trump's declaration of a 90-day suspension on controversial US tariffs – though the reprieve excludes China, which continues to face the full brunt of American trade measures.

After days of turmoil on world stock exchanges in the wake of sweeping tariffs announced by the US president on 3 April, Donald Trump abruptly paused his trade war on most countries this Wednesday, sparking euphoria on global markets.

The move also offers a temporary pause in escalating transatlantic trade tensions and opens the door for renewed negotiations between Washington and Brussels.

Europe had been gearing up to impose retaliatory duties of up to 25 percent on a wide range of American goods, in response to US tariffs on steel and aluminium introduced last month. The European Commission, speaking after 26 of 27 EU member states approved the countermeasures – with only Hungary opposed – had stated these tariffs were “unjustified and damaging,” calling instead for a “fair and balanced negotiated outcome”.

“The EU considers US tariffs unjustified and damaging, causing economic harm to both sides, as well as the global economy,” the Commission noted Wednesday.

It stressed the need for a resolution that is “balanced and mutually beneficial”.

Trump's tariffs enter force, upending economic ties with Europe

Retaliation and negotiation

Although the retaliatory duties were due to be collected starting 15 April, the Commission had already indicated that these could be suspended if the US showed willingness to negotiate.

Trump's decision to pause the tariffs has thus been interpreted in Brussels as a potential opportunity to avoid a deeper trade conflict.

The EU's countermeasures were carefully crafted to target politically sensitive sectors in the United States.

EU readies response to new US tariffs, France braces for fallout

The list of goods includes poultry, corn, rice, nuts, motorcycles, wood, textiles, plastics, and electrical equipment – many produced in Republican-held states.

Bourbon, initially on the list, was later removed after pressure from major wine-exporting nations such as France and Italy, concerned about possible US retaliation against European wines and spirits.

Beyond the steel and aluminium dispute, Trump has also targeted Europe with a 25 percent tariff on car imports and introduced so-called reciprocal tariffs of 20 percent on various EU goods.

The European response to those specific measures is still in the works and may be announced as early as next week, according to an EU spokesperson.

China left out in the cold

While Europe and other countries received a 90-day reprieve, China has been explicitly excluded.

Trump's latest wave of tariffs, which came into force Wednesday, hits Chinese imports hardest – raising total duties on certain goods to a staggering 104 percent.

In retaliation, Beijing has increased its tariffs on US goods from 34 percent to 84 percent – a move that comes into effect today.

China has also escalated its legal challenge, filing a formal complaint with the World Trade Organization.

The Chinese Commerce Ministry accused Washington of "unilateral bullying" and vowed to "fight it to the end".

A spokesperson said the tariffs are a “grave mistake” that highlight the US's disregard for multilateral trade norms.

Although multiple countries have initiated WTO complaints over the US tariffs, the organisation's ability to intervene is limited.

Its dispute resolution system has been weakened in recent years, with the US blocking the appointment of new judges.

With 90 days on the clock, the international community now faces a critical window to dial down trade tensions – or risk a deeper global rift.