President Donald Trump is retreating from his hardline stance on Chinese tariffs, signaling a potential reduction from the staggering 145% rates he imposed just weeks ago. This U-turn comes as the International Monetary Fund issued stark warnings about his tariff policies dragging down both the US and global economies.

Despite previously boasting that tariffs would deliver a “golden age” of manufacturing prosperity, Trump is now softening his rhetoric, claiming tariffs will “come down substantially” while insisting “we’re doing fine with China.” 

This pivot suggests his administration is beginning to recognize the economic damage caused by what the IMF called the “highest import taxes in more than a century” — maybe. China did not show any signs it would back down from a trade war with Trump, going as far as warning other economies against making deals to “appease” the US.

Trump’s retreat follows Treasury Secretary Scott Bessert’s closed-door admission that the trade war is “not sustainable” and market turmoil that saw stocks plummet. Economists at JPMorgan Chase warned Trump’s policies could push both the US and global economies into recession while potentially doubling inflation to 5%.

Read: Trump’s Demand for ‘Preemptive Cuts’ Triggers Market Slide

On Chinese social media, Trump’s apparent backpedaling trended as “Trump chickened out” and “Trump admitted defeat,” according to reports — despite his claims of negotiating strength with Chinese President Xi Jinping.

While Trump insists he has a “very good relationship” with China, his erratic policymaking has already disrupted global supply chains, rattled financial markets, and stoked recession fears. The IMF predicts US growth will now fall to just 1.8% this year — a third lower than projected in January and well below global averages.

For a president who campaigned on negotiation prowess, the rapid retreat signals that his aggressive tariff strategy has failed to produce the concessions he promised from China, instead primarily harming American consumers and businesses. And, there aren’t as many trade deals as the administration hoped the tariffs would produce.

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