- After Trump said he would cut tariffs, the Dow Jones went up by 1,000 points.
- Trump reduced tariffs on China, easing U.S.-China trade tensions.
On April 23, 2025, U.S. stock markets soared after President Donald Trump announced major tariff cuts on China. There was a noticeable increase of one thousand points in the Dow Jones Industrial Average, which was extremely obvious. Despite the fact that the S&P 500 and the Nasdaq Composite both increased by 3%, investor confidence was regained.
U.S. relations with China had been uneasy for weeks before the cuts to U.S. tariffs. Trump said the tensions that unsettled global markets were cooled, while tariffs would decrease substantially. This policy shift also paused the “Sell America” trade narrative that had been gaining traction.
Bitcoin, on the other hand,broke through $93,000, and the cryptocurrency market has been strong. Gold prices meanwhile fell below $3,300 as investors ditched riskier assets in favor of equities. All major indexes showed gains by April 23, according to a FactSet chart tracking U.S. stock indexes over three sessions.
Trump’s Reversal of Tariff Causes Market Impact
In April, before that, Trump had suggested a 145% tariff on Chinese imports that economists said would effectively end most U.S. China trade. On April 10, the White House official confirmed the high rate of the tariff and fears of economic fallout.
By April 23, Trump’s decision to lower tariffs had reversed the downward trend. It follows a period of negotiation in which business leaders had been pressing the government for relief from the effect of high tariffs on supply chains and consumer prices. Federal Reserve Chair Jerome Powell, who had been under attack during the market turbulence, got a reprieve from the tariff reduction.
Powell had signaled earlier the Federal Reserve’s patience. On April 16, he said the Fed will wait to assess the impact of Trump’s policies, including tariffs, before changing the rates. The rollback of the tariff alleviated immediate pressure on the Fed and allowed Powell to keep the central bank’s current posture.
Changing dynamics between Trump and Powell
Since Powell was appointed chairman of the Federal Reserve in 2018, Trump’s relationship with Powell has been fraught.With regard to interest rates, Trump has regularly voiced his disapproval of Powell. In response to Powell’s refusal to reduce interest rates on April 17, Trump referred to Powell as “playing politics” and even threatened to dismiss him. Powell has declared that he does not intend to leave the position earlier than the May 2026 that he is scheduled to retire from.
The tensions rose to a peak when Trump called for lower interest rates to boost economic growth in an uncertain time of trade. Trump suggested a different tone by April 22. He said he had no plans to fire Powell and acknowledged that the Fed had a role in keeping economic stability. In a time of market recovery, Trump was apparently conscious of how the backlash could come if he disrupted the Fed’s independence.
The Fed’s autonomy in monetary policy, too, was also backed by bipartisan support, which further added to the support for Powell’s position. On April 23, the stock market went up sharply and boosted investor sentiment, as the dual gain of tariff reduction and Trump’s softened stance on Powell was realized.
The broader economic context was also involved in this. Data from Nasdaq also shows that over the long term, Bitcoin has outperformed traditional assets such as gold and the S&P 500 with a return of 437,171 percent since 2011. This resilience in cryptocurrencies, along with the tariff news, encouraged investors to re enter equity markets.
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