Trump Suspends Tariffs Amid Bond Market Panic

President Trump's recent decision to pause his sweeping tariff regime, including a 125% tariff on Chinese goods, was largely influenced by a tumultuous bond market that signaled alarm about rising government borrowing costs. The bond market, described as a powerful and unofficial 'fourth branch of government,' reacted negatively to the tariffs, causing a significant sell-off that raised the 10-year Treasury yield from 3.9% to 4.5%. This volatility prompted White House officials to expedite discussions about pausing the tariffs, which had initially been set to implement without change. While Trump publicly framed the pause as part of ongoing negotiations with multiple countries, analysts and insiders suggested that it was primarily the financial market's reaction that forced the administration's hand. Fox Business correspondent Charles Gasparino underscored that the White House essentially capitulated to market pressures rather than negotiating from a position of strength. Trump's announcement included a temporary relief for countries not retaliating against U.S. tariffs, while further escalating the trade war with China.