Donald Trump is on a roller coaster ride all alone. After reaching new heights with the April 2 announcement of "reciprocal" tariffs on the rest of the world, he's now coming back down just as quickly. The absurd rates initially announced, which were not based on any serious calculations (50% on Lesotho, 46% on Vietnam, 20% on the European Union…), only lasted a week, having been suspended for 90 days as of April 9. An agreement with the United Kingdom followed on May 8. Then came the main news, with the suspension for 90 days of tariffs imposed on China, announced on May 12.
Whether it was the financial storm that forced the hand of the US president or a shrewd negotiation tactic, it doesn't matter: it is a spectacular retreat. Yet it is only partial. Even after these concessions, US tariffs on the rest of the world are much higher today than they were three months ago, having risen from 2.5% to 14% on average, according to calculations by Barclays, a British bank. It's certainly better than the 25% reached at the peak of Trump's tantrums, but it remains their highest level since the 1930s. Even if Trump makes additional gestures, which is possible, global trade has entered a new era.
"We are not out of the woods yet," noted a report from the Capital Economics firm. The Chinese agreement is the most spectacular example. After the de-escalation, US tariffs imposed on China now stand at 39%, compared to about 13% at the end of 2024. Although far from the 145% brandished by Trump for a few weeks, the brake on trade between the two countries will be severe.
A recession in the US remains possible
The agreement with the United Kingdom also represents a bittersweet result for London. The UK has secured the cancelation of 25% tariffs on steel and aluminum, as well as on cars (within a quota of 100,000 vehicles, which was exactly the level of British vehicle exports in 2024). But, like the rest of the world, the United States will continue to impose 10% tariffs on all other UK exports.
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