The tariff war escalated dramatically as Trump implemented his threatened duties. China immediately countered with 84% tariffs on all US products, strategically targeting rare earth materials essential for American manufacturing. By midday, the EU approved retaliatory tariffs worth €21 billion on US goods, with only Hungary opposing.
European markets suffered, with Spain's IBEX plunging 2.7%. The Bank of Spain announced it would lower growth forecasts due to trade disruptions. Spanish Prime Minister Sánchez, visiting Vietnam, warned that "workers lose the most in trade wars" while the US Treasury Secretary cautioned Spain against closer Chinese ties, describing it as "cutting its own throat."
By evening, Trump made a surprising move, suspending tariffs for 90 days for most countries while increasing China's to 125%. This announcement triggered Wall Street to surge over 7%, demonstrating the volatile market reactions to Trump's unpredictable trade strategies.