What you need to know
For a full report, read more: Trump piles on the tariffs but Britain avoids the worst
Cost of living hit to millions, retail warns
The cost of living in America will increase after President Trump’s tariffs, the world’s largest retail trade association has said.
“Tariffs are a tax paid by the US importer that will be passed along to the end consumer,” said David French of the National Retail Federation. “Tariffs will not be paid by foreign countries or suppliers.” The tariffs are likely to hit smaller communities and retailers much harder, French added, with millions of businesses across the US set to be affected.
Irish PM joins EU chorus of disapproval
There is “no justification” for Trump’s tariffs, the Irish prime minister said.
All imports from the European Union, including Ireland, will be taxed at 20 per cent, according to a long list of reciprocal tariffs unveiled by the White House. Micheál Martin said his government would “reflect with” EU partners on how best to proceed.
“We see no justification for this,” he said. “Now is a time for dialogue, and I believe that a negotiated way forward is the only sensible one. A confrontation is in no one’s interests. Ireland will be a strong advocate for an outcome which enhances the existing and strong transatlantic trading relationship.”
Australia: ‘This is not the act of a friend’
Anthony Albanese, the Australian prime minister, said the decision by President Trump to impose tariffs was not “the act of a friend”, but that his country would not place reciprocal tariffs against the United States. Trump imposed 10 per cent tariffs on Australia.
Meloni: Tariffs are ‘wrong’
Giorgia Meloni, the Italian prime minister, issued one of the first responses by a western leader. She said that the US tariffs were “wrong”, and that she wanted to negotiate with Washington and Brussels to avoid a trade war.
China hit with 54% total tariff
The total tariff charge placed on imports from China is 54 per cent, the White House has clarified.
This includes the 34 per cent reciprocal tariff announced today by President Trump, alongside the existing 20 per cent tax that had already been imposed.
Karoline Leavitt, the White House press secretary, confirmed this to CNBC.
Trump’s speech was like a game show. What did your country win?
“My fellow Americans!” President Trump said. “This is liberation day!”
It was a bright cold day in April and the clocks were striking 16, or at least 16.05. Trump stood before the White House colonnade that had been draped in American flags. In front of him was a border of orange tulips. Not from Amsterdam. Or at least not any more.
Beyond the tulips sat another row of delicate flowers: the members of Trump’s cabinet. Marco Rubio, who looks shorter by the day, sat with his hands tightly clasped.
• Read Will Pavia’s full sketch here
Baseline tariff to kick in on Saturday
All countries are being charged a “baseline” tariff of 10 per cent, with some facing additional reciprocal tariffs.
The White House has said officials will start charging the 10 per cent tariffs on Saturday, with the higher duties starting on Wednesday next week.
According to the board brandished by Trump at the announcement, the White House has calculated that the UK charges the US a 10 per cent tariff. It seems to suggest the UK will be included in the first wave of “baseline” tariff measures, due to come into place on Saturday, but with no increase next week unlike many other nations.
Tories blame Labour for ‘disappointing’ tariff
The Conservatives have called the 10 per cent tariff “disappointing news” as they blamed Labour for failing to negotiate with Trump’s team.
Andrew Griffith, shadow trade secretary, said Labour had “failed to keep our experienced top trade negotiator, and failed to get a deal to avoid the imposition of these tariffs by our closest trading partner.
“The chancellor’s emergency budget of just a week ago, with its inadequate headroom, is now at risk, casting uncertainty about more taxes or spending cuts. Sadly, it is British businesses and workers who will pay the price for Labour’s failure,” he added.
“The silver lining is that Brexit — which Labour ministers voted against no less than 48 times — means that we face far lower tariffs than the EU: a Brexit dividend that will have protected thousands of British jobs and businesses.
“President Trump is an admirer of Britain and our negotiations in government showed he wants to do a deal. Labour must swallow their pride, put Britain first and get back round the negotiating table to agree a fair deal to protect jobs and consumers in both the UK and the US alike.”
Government still seeking US trade deal
Jonathan Reynolds, the business secretary, has reiterated the government’s intentions to seek a deal that will enable Britain to swerve the White House’s tariffs.
“The US is our closest ally, so our approach is to remain calm and committed to doing this deal, which we hope will mitigate the impact of what has been announced today,” he said in a statement.
However, he also appeared to suggest that the government would put its national interests ahead of appeasing Trump and his demands. “Nobody wants a trade war and our intention remains to secure a deal. But nothing is off the table,” he said.
UK tariff ‘vindicates’ No 10 strategy
A Downing Street source has said the UK receiving the lowest tariff is a “vindication” of No 10’s strategy in dealing with the White House.
“No tariffs are good, not what we want. [That they are] lower than others vindicates our approach. This is important because the difference between 20 per cent to 10 per cent is lots of jobs. We will keep negotiating, keep cool and calm. We want to negotiate a sustainable trade deal, and of course want to get tariffs lowered. Tomorrow we will continue with that work,” the source said.
A Whitehall figure told Sky News’s Beth Rigby that the announcement “bears up what we’re hearing, that the UK is in a friendlies club — as much as that’s worth anything”.
Trump’s approval rating dips
Moments before Trump began speaking an Ipsos poll found that the president’s approval rating had fallen to 43 per cent, its lowest since his return to power, as fears about the economy weigh on voters.
Respondents gave Trump only 37 per cent approval for his handling of the economy and 30 per cent on addressing the cost of living, the leading issue among voters at last year’s election. More than 50 per cent of respondents feared that imposing tariffs would do more harm than good.
Trump registered an approval rating of 47 per cent in the same poll shortly after taking office in January.
• Trump’s approval rating: tracking the opinion polls
Tariffs ‘major blow’ to small and medium firms
Trump’s 10 per cent tariff on imports from the UK will deal a “major blow” to small and medium businesses, an influential trade group has warned.
At present, 59 per cent of small UK exporters sell into the US market, the Federation of Small Businesses (FSB) said.
“Tariffs will cause untold damage to small businesses trying to trade their way into profit while the domestic economy remains flat,” said Tina McKenzie, the FSB’s policy chairwoman.
“The fallout will stifle growth, hurt opportunities and put a serious dent in the global economy. The UK government should now be ready to provide emergency assistance to any SMEs [small and midsize enterprises] at risk of collapse.”
Trump leaves press conference
A fanfare has struck up and Trump makes his way back into the White House building from the garden.
President signs executive order
Trump has ended his speech and has moved on to signing the order on a desk.
“That’s a ten,” he said, remarking on his signature.
Analysis: British rate could be much worse
By Oliver Wright
Downing Street will be breathing a small sigh of relief tonight. While the 10 per cent tariff imposed on all UK exports to the US is bad, it could have been worse.
Trump has long complained that the 20 per cent VAT charged on all goods sold in Britain and Europe is an effective tariff on American exports — because there is not the same universal sales tax in America.
But while he has charged the European Union the full 20 per cent in reciprocal tariffs for reasons which are not yet entirely clear, the charge on the UK is only 10 per cent. Yet that will still hurt — unless in the coming days and weeks the government can persuade Trump to lift it as part of a wider trade deal.
In pure numbers it means that the £60 billion a year we export to the US each year has just become £6 billion more expensive.
British tariff rationale unclear
It is not clear how the White House has determined that the UK imposes 10 per cent tariffs on American imports. The board held up earlier by President Trump suggested the figure takes into account currency manipulation and trade barriers.
The British government and the Bank of England do not engage in currency manipulation, allowing the pound sterling (GBP) to float freely in the foreign exchange markets.
However, there are a number of barriers in place to disrupt trade flow between the two countries. One example is the ban that Britain has placed on hormone-treated beef and chlorinated chicken from the US, which limits American agricultural exports.
Dollar falls sharply
The US dollar has been falling sharply against key currencies on Wednesday evening as Donald Trump delivered his tariffs announcement at the White House.
The dollar had dropped about 0.7 per cent against the pound, at 0.768, shortly after the speech began. The US currency was weakening further against the euro, falling about 1 per cent, at 0.9162.
Traders have been reacting to developments from the US amid uncertainty over how global trade will be impacted by new tariffs, and how far affected countries will respond.
Britain ‘will still feel effects’
While Britain has received the minimum tariff, economists have warned that the country will be affected by the high charges put on the likes of China, Japan and the EU.
Trump warned that the tariffs would be reduced only if other countries stopped charging American firms to sell in their markets.
Minimum global tariff is 10%
The 10 per cent charge is the minimum tariff imposed on all foreign countries, Trump said.
These are Trump’s “reciprocal tariff” charts in full:
Trump hints at tit-for-tat with UK
Trump mentioned the UK and said “we’ll do the same” to reflect the tariffs the US claims Britain imposes on US products.
UK tariff set at 10%
Britain will receive the lowest rate of tariffs, according to a board shown by the president during the announcement. The UK will be charged a 10 per cent tariff.
Tariffs ‘could have prevented Great Depression’
Trump said the Great Depression would “never have happened” if America had kept the tariff regime which was in place until 1913.
“We are going to start being smart and we’re going to be wealthy again,” he said
Foreign cars slapped with 25% tariff
Donald Trump confirmed America would impose tariffs of 25 per cent on all foreign-made automobiles from midnight.
‘In trade, friends are worse than foes’
“In many cases the friend is worse than the foe in terms of trade,” the president says, as he singles out Korea and Japan, where citizens drive mostly domestically produced cars.
President sets out existing tariffs
Trump is listing examples of what he sees as unfair international trade barriers. “Until today the US charges 2.5 per cent on foreign automobiles. The EU charges 20 per cent tariffs,” he said.
JD Vance given lighthearted mention
Trump is singling out members of his cabinet for compliments. He points to JD Vance, who he jokes is “gaining a lot of confidence”.
Trump will use ‘trillions’ of dollars to pay down taxes
“It’s our turn to prosper and to use trillions and trillions of dollars to pay down our taxes,” he said.
“Jobs and factories will come roaring back into our country,” he added, to cheers from the audience.
President dismisses ‘scavengers’
Trump said today was the day American industry was “reborn”. “Foreign scavengers have torn away our American dream,” he said. “Our country has been ripped off for 50 years. It’s not going to happen anymore.”
Trump announces ‘Liberation Day’
“Nice crowd. What a good-looking group of people,” he said as he thanked the audience, who cheered and clapped. “This is Liberation Day,” he said.
President arrives
Donald Trump has appeared in the Rose Garden to a fanfare while holding a red MAGA hat as he prepares to start the tariff announcement.
Workers and Republicans gather
Trump supporters have gathered near the White House and have been taking pictures with members of the president’s circle as they wait for the imminent announcement.
The Middle East envoy Steve Witkoff and JD Vance, the vice-president, were pictured in the Rose Garden rubbing shoulders with blue-collar workers.
Timeline of the Trump-Musk ‘bromance’
President Trump’s tariff “liberation day” marks what the White House believes is the beginning of economic freedom for the American people. At the same time, Elon Musk appears to be heading towards his own liberation from the administration.
After weeks of murmurings in Washington that the world’s richest man had become a disruptive and unpredictable force — hiring, firing and cutting with little oversight — Trump is said to have told his inner circle that Musk was preparing to step back from his role as a senior adviser.
Here, we look back at the highs and lows of their nine-month “bromance”.
Watch: chancellor to remain ‘clear-headed’
Uptick for Wall Street before announcement
US stocks are up in advance of Trump’s announcement where it has been reported he is looking at varying the level of tariffs between countries and industries.
The Dow Jones Industrial Average was up 0.2 per cent, the benchmark S&P 500 rose 0.2 per cent and the tech-heavy Nasdaq had gained 0.3 per cent. Japan’s Nikkei gained 0.3 per cent in pre-market trading.
Trade chief defends tariffs for car industry
Peter Navarro, the White House’s senior counsellor for trade and manufacturing, has defended the imposition of tariffs, describing them as a “restoration of full-spectrum manufacturing” in an opinion piece for USA Today.
Navarro singled out automobile duties, arguing that they would drive job creation and boost wages throughout the United States.
“No longer does America fully manufacture its own automobiles,” he said. “We largely assemble high-value parts made overseas.”
Explaining the decline in US auto manufacturing, Navarro said that “other nations use unfair trade practices and predatory industrial policies to flood our market with subsidised vehicles and parts while blocking US exports from reaching their own consumers”.
Trump to scrap tax loophole on China
The White House is considering revoking tariff exemptions for low-value shipments from China as part of tonight’s announcement, according to Reuters.
The decision would reinstate Trump’s decision in February to end duty-free entry for cheap Chinese goods entering the US. Officials had paused the decision given logistical issues complicating the inspection of millions of low-value shipments.
“They figured it out,” the source said. “De minimis is being stripped from China.”
Elon Musk loses battle of the billionaires
A $20 million intervention by Elon Musk failed to stop Wisconsin voters putting a liberal judge on the state supreme court in an election the tech billionaire had described as vital to “western civilisation”.
Susan Crawford, who was endorsed by the Democratic Party, was elected on Tuesday to replace one of the four liberal-leaning judges on the seven-judge court. Early results suggested she had beaten her opponent Brad Schimel, a Republican former state attorney-general, by about ten percentage points.
The vote was viewed in Washington as an early referendum on President Trump’s popularity, whose approval ratings have dropped in recent weeks amid dissatisfaction at the US economy and his administration’s widespread cost-cutting efforts.
In charts: how will the UK fare?
Florida voters dash Democrats’ hopes of Trump backlash
Republicans have won two special elections in Florida for seats in the House of Representatives, strengthening President Trump’s hand on Capitol Hill.
The votes had been billed as referendums on Trump’s performance since returning to the White House two and a half months ago, with Democrats hoping they might take at least one of the seats by exploiting voter concerns about cuts to public spending and the possibility that Trump’s tariff regime might cause a global trade war and economic recession.
Florida’s 1st and 6th districts became open when Trump nominated their representatives — Matt Gaetz and Mike Waltz respectively — for his cabinet. Randy Fine, a Florida state senator, ran to replace Waltz, now serving as Trump’s national security adviser. He won with a majority much narrower than Waltz’s 33-point margin in November.
Tesla sales tumble
Tesla’s worldwide sales tumbled in the first quarter, figures showed on Wednesday, piling further pressure on Elon Musk, the company’s chief executive, who faces a growing backlash for his role overseeing US federal spending cuts under President Trump.
Musk’s electric vehicle company delivered 336,681 cars worldwide in the first three months of this year, a drop of 13 per cent. The quarterly figures were the lowest in nearly three years.
Musk, the world’s richest person, donated about $270 million to Trump’s 2024 presidential campaign.
Can Trump run for a third term?
President Trump has insisted he is “not joking” about the possibility of serving a third term, in his clearest statement yet that he may seek to extend his presidency beyond the limit set by the US constitution.
“There are methods [by] which you could do it,” he told NBC News. When asked if JD Vance, the vice-president, could run for office and then hand him the role instead, Trump said: “That’s one [method]. But there are others too.”
The president said it was “far too early to think about” how he might remain in the White House after four years, but added: “A lot of people want me to do it. But, I basically tell them we have a long way to go, you know, it’s very early in the administration.”
Steel and car industry workers to watch Trump speech
Steelworkers and car manufacturers have been asked to the White House to watch Trump announce tariffs aimed at protecting their industries, it has been reported.
They will be alongside JD Vance, the vice-president, as well as Mike Johnson, the House speaker, Steve Scalise, the House majority leader, and other members of Congress. The announcement is due to take place in the Rose Garden at 4pm EST (9pm BST).
Trump rounds on Republican detractors
Trump used his Truth Social platform to attack four Republican senators backing Democrat moves to overturn the state of emergency he declared at the southern and northern US borders in order to put 25 per cent tariffs on Mexico and Canada.
The four — Mitch McConnell, Susan Collins, Lisa Murkowski and Rand Paul — were “playing with the lives of the American people, and right into the hands of the radical-left Democrats and drug cartels”, Trump wrote.
“The Senate bill is just a ploy of the Dems to show and expose the weakness of certain Republicans, namely these four, in that it is not going anywhere because the House will never approve it and I, as your president, will never sign it. Why are they allowing fentanyl to pour into our country unchecked, and without penalty. What is wrong with them, other than suffering from Trump derangement syndrome, commonly known as TDS?”
Tariffs represent ‘salvation for America’
President Trump’s small-business administrator, Kelly Loeffler, appeared on the radio this morning to make a case from the standpoint of companies which she claimed could benefit from the president’s protectionist moves.
“’Liberation day’ … is the single greatest salvation for not just small businesses but for America,” Loeffler told Fox Business Network.
“This country was travelling down an unsustainable path and President Trump has been the only president that has a backbone to stand up to our allies and adversaries alike and say, we have to level the playing field. This is unfair. You’re no longer going to take advantage of us.”
UK must remain ‘cool, calm and collected’
The director-general of the CBI, Rain Newton-Smith, has told Times Radio that the UK must be “cool, calm and collected” in the face of Trump’s tariff policy.
“We don’t know yet fully what the US administration will do. But I think what I hear from business leaders is the UK government is taking the right approach to thinking about our own national interests to negotiate the best possible deal with the US.
“Actually the problem is no one wins in a trade war if we go into this saying we’re going to match fire with fire and we’re going to retaliate up to a maximum, we’re going to try and outdo you.
“I think the challenge is UK businesses would also be hit by the retaliation. So I think it’s really important we go into those negotiations with a clear focus on our economy, the needs of our economy and with the aim of getting the absolute best deal possible.”
Why members of Trump’s own party fear his tariffs
Republicans are growing increasingly nervous about President Trump’s imposition of sweeping tariffs on what he is calling “liberation day”.
Members of Congress representing rural areas are worried about the impact of any rise in fertiliser costs on farmers, while those from northern states are anxious that a trade war with Canada will disrupt cross-border industries from lumber to fresh produce.
The White House said Trump would make his tariff announcement in the Rose Garden to selected guests on Wednesday at 4pm ET (9pm GMT), the moment stock markets close in America.
Elon Musk to ‘step back’ from advising Trump
Elon Musk is preparing to step back from his role as a senior White House aide, President Trump has told his inner circle.
Trump said he remained satisfied with Musk’s contributions — the billionaire has overseen a vast, unprecedented programme of government cuts — but it has been agreed that he will soon return to his businesses, Politico reported.
It comes after weeks of concern among White House insiders that Musk, 53, had begun to overstep his remit as a government adviser and become a liability to the Trump administration.
• Follow live updates on this breaking story here
Tariffs could wipe out growth in Britain
High tariffs will wipe out growth in the UK next year, according to a leading think tank.
The National Institute for Economic and Social Research (NIESR) said that if the UK is hit by a 10 per cent universal tariff and 60 per cent tariffs on China, the economy is unlikely to grow at all in 2026.
“Our estimates also show that the UK economy is vulnerable to the negative effects of US tariffs through both direct and indirect channels,” a spokesman said.
“We find that tariffs raise prices and weaken economic activity in the United Kingdom, with the size of the effects depending on the scope of the tariffs. Even if the United Kingdom were exempt from these tariffs, economic activity could still suffer due to broader global disruptions. In a worst-case scenario where high tariffs are applied, UK GDP growth could fall to zero next year.”
NIESR said global economic output could be 2 per cent lower over five years, with individual economies such as Canada and Mexico particularly badly affected.
The think tank’s principal economist Ahmet Kaya, said: “Tariffs, in any form, impose costs on businesses and households, particularly in the country imposing them. However, history shows how devastating a full-scale tariff war can be. In today’s highly integrated global economy, such a race to the bottom could disrupt supply chains and send shock waves across the world, affecting businesses and households far beyond the directly impacted countries.”
Mexican president puts on brave face
The Mexican president Claudia Sheinbaum struck an optimistic tone in the face of tariffs, which could severely damage her country’s economy.
Sheinbaum’s government has sought preferential treatment by the Trump administration because of longstanding free-trade pacts between Mexico, the US and Canada. Sheinbaum said she would wait to take action when it was clear how Trump’s announcement would affect Mexico, and that her government was constantly in contact with his administration.
“It’s not a question of ‘if you impose tariffs on me, I’m going to impose tariffs on you’,” she said in a news briefing on Wednesday. “Our interest is in strengthening the Mexican economy.”
While Trump has already imposed tariffs on steel and aluminium, economic forecasters have warned that broader 25 per cent tariffs could thrust Mexico’s economy into a recession.
Where will Trump tariffs have most impact?
President Trump’s decision to go ahead with blanket tariffs on goods from Canada, Mexico and China has put an end to weeks of uncertainty about whether the president would be true to his word.
The 25 per cent import levy on Canada and Mexico and an additional 10 per cent tariff on Chinese goods marks the biggest escalation of US protectionism under Trump’s presidency, dating back to 2016. Average US tariffs are now the highest in more than half a century.
The first wave of tariffs is likely to be followed by a series of additional measures. Trump has ordered his officials to look into imposing “reciprocal” tariffs on all countries that impose levies on US goods, singling out VAT in the European Union and the UK as an unfair “tariff” worthy of retaliation.
Meloni concerned for Italian producers
Giorgia Meloni, the Italian prime minister, said US tariffs could have negative consequences for Italian producers and could limit access to Italian products in America.
“The United States is our second-largest export market, with a 17 per cent increase in exports in 2024. The US market is crucial for us,” she said in a speech in Rome.
“It is clear that the introduction of new tariffs would have a heavy impact on Italian producers. I also believe it would be unfair to many Americans, as it would limit access to our excellent products to only those who can afford higher prices,” she added.
She said Italy would defend its industries if “necessary”.
Reeves to avoid ‘posturing’
Reeves said the UK would not risk the possibility of a trade deal with the US by “posturing” in response to the president’s tariffs.
The chancellor told MPs she had been speaking to exporters who did not want a rushed response. She said: “We don’t want to be posturing here, the prize on offer is a good economic agreement between us and the United States. We are not going to do anything to put that in jeopardy, we are not going to rush into action to get a quick headline.”
She said she had discussed the situation with Valdis Dombrovskis, the European Commission economy chief.
“Let’s see how other countries and other trading blocs respond,” she said. “We are discussing with other countries and the EU about the appropriate response to whatever announcements are made later today. “
Keir Starmer won’t hit back with tariffs
Sir Keir Starmer will resist putting retaliatory tariffs on American goods even if British exporters are hit by US duties on Wednesday.
President Trump has vowed to impose levies on a wide range of goods from April 2, which he has declared “liberation day”.
Starmer’s hopes of securing an exemption for British businesses have faded despite the efforts of Jonathan Reynolds, the business secretary, to secure a bespoke trade agreement. Reynolds described talks last week as “challenging”.
On Monday, Dame Angela Eagle, the home office minister, said that “intensive talks are going on even as we speak over in the US to see if we can come to that agreement for our mutual economic benefit”.
Trump celebrates ‘liberation day’
President Trump has posted on his social media platform Truth Social to celebrate the announcement of a slew of tariffs on US trade with the rest of the world.
X (Twitter) content blocked
Please enable cookies and other technologies to view this content. You can update your cookies preferences any time using privacy manager.
Deal would not mean UK is ‘out of the woods’
The UK would not be “out of the woods” on tariffs even if it could secure a deal with the United States, the chancellor has told MPs.
Rachel Reeves told the Commons Treasury committee that the main impact on the British economy would be from “global tariffs” rather than UK-specific ones, thanks to depressed demand and higher inflation in other countries.
She said: “I think that’s really important to understand, because even if we are able to secure an economic deal with the United States — which we very much want to secure and are working hard to secure that — even if that’s possible, [it] doesn’t mean somehow that we are out of the woods and not impacted by tariffs.
“So we don’t just want to see an agreement between the UK and the US, we want to see free trade continue.”
Who is Karoline Leavitt, Trump’s press secretary?
Unfailingly loyal and on-message, Leavitt is perhaps the most visible person in the White House after the president as she takes on the traditional media at press briefings.
The New Hampshire-born Trump acolyte has said politics was “in her blood” growing up in a small town, where she worked in her parents’ ice cream parlour. “My dad came from nothing and worked his way up,” Leavitt told the Eagle Tribune in 2020. “He didn’t take any handouts from anyone. He reminds me of President Trump.”
Leavitt attended Saint Anselm Catholic College and became hooked on politics during the 2016 Trump campaign. While her fellow students were partying at college football games, she was firing off letters to the White House, and secured internships in Washington and at Fox News during Trump’s first term.
After graduating in 2019 with a degree in communications and political science she joined Trump’s team, swiftly rising to become assistant press secretary. In January last year she became his campaign press secretary.
Trump’s presidential campaign coincided with Leavitt’s first pregnancy with her husband Nicholas Riccio, a property tycoon more than 30 years her senior. Plans to take maternity leave evaporated when, three days after giving birth to her son, she saw Trump survive an assassination attempt. “The president literally put his life on the line to win this election. The least I could do is get back to work quickly,” she said.
Stock markets fall in Europe and US
US and European stock markets fell on Wednesday as investors worried over what shape the fresh wave of tariffs would take at the end of the day.
The dollar and oil prices dipped while gold, viewed as a safe-haven investment, came close to achieving an all-time high.
After Tokyo’s stock market closed up slightly and Chinese indices steadied, Europe dropped, led lower by Frankfurt, and Wall Street’s leading indexes followed after the open.
“For traders and investors, today represents a day of huge uncertainty as we weigh up the potential for retaliatory tariffs and a tit-for-tat trade war,” said Joshua Mahony, analyst at the traders Scope Markets.
What the Trump Slump means for your money
Investors are buying on the dips to take advantage of market shocks caused by America’s new trade tariffs. In March 60 per cent of the trades made through Interactive Investor, one of Britain’s largest investment platforms, were buys with 40 per cent being sells. For US shares specifically, 61 per cent of trades were buys and 39 per cent sells. Typically buys tend to make up about 55 per cent of trades while sales make up about 45 per cent.
America’s S&P 500 index is down about 5 per cent this year while the tech-heavy Nasdaq index is down 10 per cent as markets prepare for fresh US tariffs on Wednesday — a day President Trump is calling “liberation day”.
Myron Jobson from Interactive Investor said: “Market dips driven by geopolitical tensions, such as Trump’s tariff wars, often trigger knee-jerk sell-offs — but they could present prime opportunities to buy quality investments at a discount. Timing the market is notoriously tricky, but for those willing to ride out the storm, picking up undervalued assets during periods of uncertainty can be a rewarding strategy over time.”
The four key players behind Trump’s tariff plans
President Trump has surrounded himself with advisers who share his conviction that wide-ranging tariffs will usher in a “golden age” of prosperity. They include:
Peter Navarro, the chief trade and manufacturing adviser in the West Wing. He taught economics for 20 years, then pushed a protectionist agenda, including tough tariffs on China, as a trade adviser during Trump’s first term.
Howard Lutnick, the commerce secretary. The billionaire former chief executive of Cantor Fitzgerald, a financial services company, was a lifelong Democrat who switched to Trump for the 2020 campaign.
Scott Bessent, the treasury secretary. The hedge fund billionaire is thought to be the most reluctant of Trump’s senior advisers on the sweeping tariff plan but has come around.
Jamieson Greer, trade representative. The former US air force lawyer represented US Steel against China while in private practice and was chief of staff to Robert Lighthizer, his predecessor from the first Trump administration.
Read more : Who is behind Trump’s tariff plans? The four key players
Trump’s approval rating falls after inauguration
President Trump’s latest approval rating is at 43 per cent, according to polls by Gallup.
This is marginally higher compared with his first term but is also his lowest approval rating of his second term. Trump’s approval ratings peaked at 47 per cent immediately after his inauguration.
Read more: Trump’s approval rating: tracking the opinion polls
What countries have tariffs against the US?
The EU responded to previous tariffs on European steel and aluminium imposed under the first Trump administration with retaliatory tariffs, which were suspended under President Biden and restored on Tuesday.
Further countermeasures are set to be imposed by the EU from mid-April, bringing the total up to €26 billion. China and the US have also been engaged in a trade war since Trump’s first administration.
Meanwhile, Trump has repeatedly described India as a “tariff king”. For example, India’s weighted average agricultural tariff is 37 per cent on US products. The two countries have been working on a trade deal.
The foreign trade barriers confronting the US were detailed further in the Office of the US Trade Representative’s annual national trade estimate report a few days ago.
UK braces for blanket tariffs of up to 20%
Every year Britain exports more than £60 billion worth of goods to the United States — goods which, from tomorrow, could face blanket tariffs of up to 20 per cent.
The new taxes come on top of tariffs on cars and steel that have already been announced by the Trump administration.
So which sectors will be hit hardest? We look at the likely impact of the US president’s announcement this evening on industries ranging from pharmaceuticals to food and drink.
Read in full here: Which British sectors will be hardest hit by Trump’s tariffs?
EU ‘has the power to fight back’
Analysis by Bruno Waterfield in Brussels
The Europeans will keep a poker face and their cards close to their chest in the initial aftermath of Trump’s “liberation day”.
Europe has a good hand to play and Ursula von der Leyen, the European Commission president, has warned: “We have the power to fight back.”
It is as yet unclear what exactly Trump is planning but Europeans are braced for 20 per cent tariffs on most goods or a targeted country-by-country approach.
Brussels could decide to move beyond goods and its traditional retaliation of hitting American exports such as Harley-Davidson motorcycles or bourbon whiskies to hit services.
On services, in contrast to goods, the US has a surplus of €109 billion in trade with Europe, meaning that American tech and banking sectors are highly vulnerable.
America’s pharmaceutical sector, protected from tariffs by a World Trade Organisation agreement designed to improve access to life-saving drugs, could be affected too if Trump hits European medicine makers.
EU retaliatory tariffs ‘an issue’ for Northern Ireland
Hilary Benn, the Northern Ireland secretary, told MPs that any impact of tariffs from the US would be “felt equally” across the UK.
However, if the EU responds with its own tariffs then businesses may have to demonstrate that goods imported from the US are not leaving the UK in order to have the tariff reimbursed.
After Brexit, Northern Ireland continues to follow the EU’s rules in some areas of trading as a result of the Windsor Framework arrangement.
The government will look closely at the impact on Northern Ireland of any retaliatory tariffs imposed by the EU, the prime minister’s official spokesman said.
How do tariffs work?
President Trump’s tariffs are essentially a tax on imports with the aim of boosting American manufacturing.
The idea is that tariffs increase the price of imported goods, and are an incentive to consumers to purchase domestic products instead.
Trump insists that tariffs are paid for by foreign countries but it is importers that pay them and the money goes to the US treasury. Those companies typically pass their higher costs on to customers in the form of higher prices.
When will Trump tariffs go into effect?
The White House has said that the new tariffs will take effect immediately after they are announced by President Trump.
The 25 per cent tariff on car imports, which has already been announced, will take effect on Thursday, with taxes on parts set to come in at a later date.
Tariffs of 25 per cent on aluminium and steel imports are already in place and the tariff on all goods from China has been doubled to 20 per cent.
A delay for most Canadian and Mexican goods from Trump’s 25 per cent fentanyl-related tariffs is also due to expire today.
What tariffs could Trump impose?
The exact details will remain unclear until President Trump begins speaking at the White House, but he is expected to announce tariffs of up to 20 per cent on all imports into the US.
Trump has also often talked about “reciprocal” tariffs, which he has succinctly explained as “they charge us, we charge them”.
In March, the US treasury secretary Scott Bessent suggested the “Dirty 15” could be a target, referring to the 15 per cent of countries that make up the bulk of trade with the US and impose tariffs or other barriers on US goods.
Read in full: What tariffs could Trump impose and how can the UK respond?
Keeping calm is the order of the day for EU
Analysis by Bruno Waterfield in Brussels
Trump’s tariff barrage will hit an apprehensive Brussels and other European capitals late tonight, at 10pm local time.
There will not be immediate countermeasures, just a statement expressing regret and intent from Ursula von der Leyen, the European commission president.
Her team of trade officials, widely regarded as the best in the world outside Washington, will work through the night to pore over the tariffs package in on order to weight a suitable response.
A general strategy will be prepared in time for a meeting of EU ambassadors tomorrow. “Keeping calm is the order of the day,” said one official.
EU trade ministers meet in Brussels on Monday. The commission, following talks at a recent EU summit, wants a unified approach.
The line is to keep cool and to make sure that it is Trump, not the European reaction, that gets the blame for any economic fallout, inflation or recession.
France expecting ‘powerful’ tariffs
The French government expects tariffs to be announced later today to be in the range of between 20-25 per cent, the government spokeswoman Sophie Primas said.
“They risk being pretty powerful,” Primas told reporters.
Starmer faces calls for ‘economic coalition of willing’
Sir Ed Davey, the leader of the Lib Dems, commended Sir Keir Starmer for his “coalition of the willing” on Ukraine and called for something similar to counter the effects of Trump’s tariffs.
Starmer responded: “Every week he tries to tempt me to make a false choice between our relationship with the US and Europe.”
He said that choice was also “wrong” on trade and the economy, insisting the UK had a “balanced” trade relationship with the US.
‘Constructive talks’ with US in progress, PM says
Sir Keir Starmer has said the government is preparing for “all eventualities” and will rule nothing out ahead of President Trump’s announcement on tariffs.
Opening prime minister’s questions, Starmer emphasised that a trade war was in nobody’s interests, and the “country deserves, and we will take, a calm and pragmatic approach”. He added that his decisions would “always be guided by national interests”.
He said “constructive talks” were progressing “for a wider economic prosperity deal” with the US. The government was also working with all industries and sectors likely to be impacted by tariffs, he said.
Government and business brace for impact of tariffs
The Office for Budget Responsibility has warned that US tariffs could eliminate the chancellor’s headroom against her day-to-day spending plans, requiring her to make more spending cuts or raise taxes to meet her fiscal rules.
The tariffs could also knock up to 1 per cent off the size of the economy if the UK embarks on a full-blown trade war, which the government has so far suggested will not be happening.
Thousands of jobs could also go, with analysis from the Institute for Public Police Research think tank suggesting tariffs on car imports would put 25,000 UK jobs at risk.
‘No knee-jerk reactions’ from government
Bridget Phillipson, the education secretary, said Britain was in a “strong position” to strike a deal with the US but admitted the next few weeks could be challenging.
She told Sky News this morning that a trade war with the US “would be in no one’s interests”, and suggested Britain would not introduce reciprocal tariffs as the EU has already vowed to do.
Phillipson said that ministers were still “working at pace” to secure a deal.
“I think we all recognise this is going to be a difficult period, but there won’t be any knee-jerk reactions from this government,” she told Times Radio.
Tariffs will hit UK exports to US immediately
In his announcement from the White House at about 9pm BST, President Trump will finally let the world in on his plans for sweeping global tariffs.
He is expected to announce tariffs of up to 20 per cent on all imports into the US, hitting the UK’s £60 billion worth of exports, effective immediately.
The White House said that liberation day, as Trump has called it, would “fix the wrongs of the past” and “restore the golden age of America”.
The EU has said it plans to retaliate by imposing its own tariffs on US products, but Sir Keir Starmer has indicated the UK will not follow suit, instead focusing on an economic deal.
Why is it called liberation day?
For weeks President Trump has built up today, the day he will unveil his long-promised set of global tariffs, as liberation day.
Many other countries celebrate liberation day in relation to freedom from Nazi Germany or another repressive regime, but Trump has repurposed the phrase several times for pivotal moments of his second term.
First it was election day that was liberation day, then the day of his inauguration. From March, Trump pivoted to April 2, the day of his tariffs announcement, and this one seems to have stuck.
Trump has complained that some countries are “ripping off” the US and his tariffs are a way to force them to lower their tariffs while driving the rebirth of America as a manufacturing superpower.
His rationale is that the US will be freed from its dependence on foreign goods and “fairness” will be restored for Americans.
Read more: What is ‘liberation day’? Only Trump seems to know
Weeks of speculation over tariffs to end today
Today has long been billed by President Trump as liberation day, and weeks of speculation about what tariffs will be applied to which countries will finally end when the president makes his announcement at 4pm ET (9pm BST).
Trump will deliver the news from the White House Rose Garden and will be flanked by his cabinet.
