Published April 23rd 2025
By Chinwendu Eugene
Equities rallied with Wall Street on Wednesday after Donald Trump said he had “no intention” of firing the head of the Federal Reserve and that eye-watering tariffs on China would be slashed drastically.
Global markets, already upended by a trade war, were battered further at the start of the week by fears the US president was looking to remove central bank boss Jerome Powell for not cutting interest rates, calling him a “major loser” and “Mr. Too Late”.
Observers warned such a move would have dealt a blow to the Fed’s independence and sparked a crisis of confidence in the world’s top economy, sparking a sell-off of US assets and another global crisis.
However, Trump looked to temper those fears on Tuesday, saying: “I have no intention of firing him.”
“I would like to see him be a little more active in terms of his idea to lower interest rates — it’s a perfect time to lower interest rates,” he said.
“If he doesn’t, is it the end? No.”
The remarks gave a much-needed shot of relief to investors, helped by the president’s comments later indicating a more conciliatory approach to the trade war with China.
Washington has imposed tariffs of 145 per cent on a range of products from China, while Beijing has replied with 125 per cent duties on imports from the United States.
But Trump acknowledged on Tuesday that the US levies were at a “very high” level, and that this will “come down substantially”.
“They will not be anywhere near that number,” he said, but added that “it won’t be zero”.
That came after Treasury Secretary Scott Bessent told a closed-door event in Washington that he expected a de-escalation soon in the United States’ tariff standoff with China, which he said was not sustainable.
White House Press Secretary Karoline Leavitt said later, “The president and the administration are setting the stage for a deal”, noting that “the ball is moving in the right direction”.
Chinese President Xi Jinping also warned on Wednesday that tariffs and trade wars “undermine the legitimate rights and interests of all countries, hurt the multilateral trading system, and impact the world economic order”.
However, foreign ministry spokesman Guo Jiakun said later in the day that “the door for talks is wide open”.
