Kemi Badenoch, Conservation Party leader
Kemi Badenoch has urged Sir Keir Starmer to bring together key allies in the UK’s Pacific trade bloc to tackle the fallout from US tariffs.
The Conservative leader said that if she were prime minister, she would convene members of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), which includes countries such as Canada, Mexico, Australia and Japan, to coordinate a response.
Speaking on BBC Breakfast, she said: “All those countries are feeling the brunt of US tariffs. What I would be doing if I was prime minister is convening those countries to see what we can do to make life easier for the citizens of our various countries.
“It’s always about making life better for people, reducing the cost of living. That can happen.”
Pedro Sánchez, the Spanish prime minister, said that the decision by President Trump to pause the enforcement of his tariffs plan opened the way to possible talks.
“The measure announced by the US administration, pending the exact nuances of its implementation, seems to open the door to negotiation and thus to an agreement between countries,” he said in a speech during an official visit in Vietnam.
He remained cautious about the details, however, and criticised the imposition of tariffs “on everyone” as “an unjustified and unfair decision”.
Spain has said it will pursue closer trade ties with China in the interests of its citizens and of the EU.
Long-term UK government bond yields fell sharply from an almost 30-year high today.
The yield on the 30-year bond slid by 18 basis points to 5.404 per cent, easing from two days of steep rises that pushed the yield up to its highest level since 1998. Prices and yields move inversely.
The rate on the benchmark ten-year bond dropped by five basis points to 4.744 per cent. The pound strengthened by 0.48 per cent against the dollar to $1.28 and dropped by 0.22 per cent against the euro to €1.16.
The downward move in UK bond yields came after severe selling in US sovereign debt markets pushed global bond rates up sharply this week. Analysts said that the sell-off in the US Treasury market was driven by hedge funds unwinding a $1 trillion “basis trade”, concerns about American inflation and potential foreign selling of US assets.
Yvette Cooper, the home secretary, said that Trump’s climbdown reinforces the UK’s strategy of being “pragmatic” rather than getting “buffeted around from day to day”.
She told BBC Radio 4’s Today programme: “We don’t want to see a trade war and we will continue to take a calm, steady approach to this and negotiate in the UK’s interests.
“We don’t want to see a trade war. We should be reducing barriers to trade rather than increasing them. What businesses want to know is that the UK government is acting in their interests.”
By Steven Swinford, Political Editor
For two hours on Wednesday night No 10 wasn’t sure as it found itself attempting to decode the US president’s latest missive on social media. In the end President Trump’s administration confirmed that, for the UK at least, nothing had changed. Britain remains subject to a blanket tariff of 10 per cent and higher tariffs of 25 per cent on exports of steel, aluminium and cars.
It means that there is still as yet no evidence of preferential treatment. The UK today finds itself in the same position as the EU despite refraining from any form of retaliation.
There is optimism in Downing Street however. Trump’s climbdown signals that he is ready to do deals, and the UK hopes to be near the front of the queue. More broadly the climbdown is likely to calm the markets and see the cost of government borrowing fall. But it is also a reminder of the sheer unpredictability of Trump, and that many in the White House — let alone those in Number 10 — have no idea what he is going to do next.
The Stoxx Europe 600 was up by 7 per cent after trading opened today as President Trump’s decision to suspend “reciprocal tariffs” for 90 days took hold.
A baseline tariff of 10 per cent on European imports to the US still remains.
Germany’s Dax rose by 7.6 per cent, with major US-focused exporters such as Siemens, Adidas and Porsche among the biggest risers.
France’s CAC 40 increased by a similar amount, with the car manufacturer Stellantis up by 12.4 per cent.
China’s foreign ministry spokeswoman has said her government was “not afraid of provocations”.
Mao Ning posted a video of the former Chinese Communist Party leader Mao Zedong during the Korean War telling the US that “no matter how long this war lasts we will never yield”.
The video is captioned: “We are Chinese. We are not afraid of provocations. We won’t back down.”
Last night, President Trump increased tariffs on Chinese imports from 104 per cent to 125 per cent.
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Both the FTSE 100 and FTSE 250 rose by more than 6 per cent as markets opened on Thursday.
It means the FTSE 100 has recovered to more than 8,000 points — up about 450 points this morning and slightly above where it was at the end of last week. It’s the biggest rally in more than five years.
The rises come after President Trump announced a 90-day pause in tariffs for trading nations, except China, restoring a measure of confidence to global markets.
• UK economy at risk of shock, warns Bank of England
Yvette Cooper has said the government will remain “really steady” in its approach to trade policy, as global markets react to President Trump’s tariff announcement on Wednesday.
Acknowledging the current international uncertainty, the home secretary told Sky News: “We are seeing changes all the time. We are seeing quite a lot of global instability.
“We are seeing that in the economy, we are seeing it also on security, on defence issues. But I think that just comes back to the approach that we have taken — it’s the plan for change that the prime minister’s set out, maintaining that stability in the face of the different turbulences.”
Ursula von der Leyen, president of the European Commission
YVES HERMAN/REUTERS
Ursula von der Leyen, president of the European Commission, welcomed Trump’s pause on tariff increases as an “important step towards stabilising the global economy”.
“Clear, predictable conditions are essential for trade and supply chains to function,” Von der Leyen said in a statement.
“The European Union remains committed to constructive negotiations with the United States,” she added.
Downing Street has insisted that Britain will continue trade talks with the United States “coolly and calmly” after President Trump announced a 90-day pause on tariffs for most countries.
While the full details of the White House’s move remain unclear, the US Treasury secretary confirmed that a baseline tariff of 10 per cent would remain in place for most nations, including the UK.
A No 10 spokeswoman said: “A trade war is in nobody’s interests. We don’t want any tariffs at all, so for jobs and livelihoods across the UK, we will coolly and calmly continue to negotiate in Britain’s interests.”
China continued the incremental devaluation of its currency.
The onshore Chinese yuan slipped to 7.33 per dollar, its weakest since 2007, after the People’s Bank of China reduced the currency fix further to 7.209. Later today, China’s top leaders are set to meet to discuss additional economic stimulus.
The FTSE 100 is set to open about 400 points higher. Major markets in Germany and France are expected to rise by 7.4 per cent and 8.7 per cent respectively.
Last night on Wall Street, the S&P 500 closed up 9.5 per cent — its best day since 2008 — and the Nasdaq Composite climbed more than 12 per cent, its strongest rise since 2001. Shares in Apple, Nvidia, Microsoft, Amazon, Meta and Tesla all jumped at least 10 per cent, while a heavy sell-off in US government debt eased.
Shares rose sharply and a global bond sell-off has stabilised after President Trump announced a 90-day pause in tariffs for trading nations, except China.
Japan’s Nikkei 225 index increased by 8.5 per cent, South Korea’s Kospi gained 5.9 per cent and Australia’s ASX 200 rose by 4.7 per cent in a relief rally.
Yet rises were more subdued in stock markets in China. Duties on Chinese goods rose to 125 per cent and Beijing has retaliated with an 84 per cent levy on American goods. China’s SSE Composite was 1 per cent higher, while Hong Kong’s Hang Seng advanced by 2.7 per cent.
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President Trump said he wanted “fair deals with everyone” as he backed down over tariffs he imposed on countries around the world less than a day after they came into force.
Trump announced a 90-day pause for his “reciprocal” tariffs on all countries but China, after bond and stock markets turned negative.
At the same time he increased duties on Chinese goods from 104 per cent to 125 per cent, in the latest escalation of a trade war between the world’s biggest economic powers. Beijing had earlier matched the extra 50 per cent Trump imposed on its imports on Tuesday, taking its total tariff on US goods to 84 per cent.
• Trump tariffs latest news – follow live
Almost every American trading partner now
