April 2025: sweeping US tariffs and the sharpest selloff of the year

On 2 April 2025 the US administration announced sweeping "reciprocal" tariffs covering most trading partners, at rates far above prior expectations. Global equities fell hard over the following sessions, and roughly a week later the administration announced a 90-day pause on the higher country-specific rates, after which equities staged one of their strongest single-day rallies in years.

At the time of the announcement, tariffs had been signalled for weeks but the breadth and size of the announced rates exceeded most published expectations. During the selloff, it was not known whether rates would be negotiated down, paused, or implemented in full.

A multi-session global equity selloff of unusual speed followed the announcement, accompanied by heavy volatility in bonds and currencies; the subsequent pause announcement was followed by a historic one-day rebound.

Which tariffs would survive negotiation, how trading partners would retaliate, what the inflation pass-through would be, and whether unusual moves in US Treasuries signalled deeper stress.

Tariff policy became the dominant macro variable of 2025: subsequent months brought sector-specific actions, partner-by-partner deals, legal challenges, and a persistent tariff premium in inflation discussions.

Current tariff stories — new rates, exemptions, court rulings, retaliation — all trace back to this framework. Our tariff coverage and recap driver-labels use this episode as their reference point.