As countries choose between retaliation and deal-making, tariffs seen as damaging even for US

US President Donald Trump announced on Wednesday a 90-day pause on tariffs for more than 75 trading partners that "did not retaliate" after his sweeping duties went into effect.

Experts warned the shift in tariff policy may not be enough to stave off a recession.

Daniel Russel, vice-president of international security and diplomacy at the Asia Society Policy Institute, said "the whiplash from constant zigzags creates more of the uncertainty that businesses and governments hate".

Stephen Olson, a visiting senior fellow at the ISEAS-Yusof Ishak Institute in Singapore, joined Al Jazeera earlier to discuss the fallout of Trump's latest trade moves. He said actions of the US could lead to China being seen as a more reliable trading partner by other countries.

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Trump's turnabout, which came less than 24 hours after steep new tariffs kicked in on most trading partners, followed the most intense episode of financial market volatility since the early days of the COVID-19 pandemic.

The upheaval erased trillions of dollars from stock markets and led to an unsettling surge in US government bond yields.

The reversal on the country-specific tariffs is not absolute. A 10 percent blanket duty on almost all US imports will remain in effect, the White House said. The announcement also does not appear to affect duties on autos, steel and aluminum that are already in place.

The 90-day freeze also does not apply to duties paid by Canada and Mexico, because their goods are still subject to 25 percent fentanyl-related tariffs.

China has accused the US of economic bullying, protectionism and unilateralism. China also urged US firms, including Tesla, to "take concrete actions" to help resolve the dispute.

Germany's leading economic institutes have slashed their growth outlook for 2025 in consideration of Trump's tariffs on steel, aluminium and cars.

Yet some other trading partners of the US remained cautious against the intimidation of the world's biggest economy, fearing that slapping their own tariffs on US goods would only make things worse.

Analysts say there's little to be gained from an all-out trade war, since higher tariffs can restrain growth and raise inflation.

The head of the World Trade Organization warned that US protectionist measures will likely cause global trade volumes to drop by about 1 percent this year.

"I am deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade," said WTO Director General Ngozi Okonjo-Iweala.

Joe Brusuelas, chief economist of consulting firm RSM US, warned the shift in tariff policy may not be enough to stave off a recession. And in a note to clients, Goldman Sachs economists projected a 45 percent chance of a recession over the next 12 months.

UK Prime Minister Keir Starmer said his government would react with "cool and calm heads".

"Nobody wins in a trade war, that is not in our national interest," Starmer said.

Higher prices loom

The tariffs are not paid by the foreign countries they target, but by the US-based companies that buy the goods to sell to US citizens. Now companies must decide whether to absorb the new taxes or pass them on to consumers in the form of higher prices.

After Trump added tariffs to imported washing machines during his first term, the median price of an appliance jumped more than 11 percent, adding about $86 to the cost of a new unit, according to University of Chicago researchers.

A recent CNBC survey found most CEOs saying prices will rise anywhere from 5 percent to 20 percent.

US consumers could end up paying an additional $2,500 to $5,000 for the lowest-cost US cars, and up to $20,000 for some imported models, according to an April 2 estimate from Anderson Economic Group.

"Businesses are starting to raise prices in anticipation of how to weather this storm, which means costs are going up for families," said Senator Elizabeth Warren on CNBC on Wednesday.

A Reuters and Ipsos survey found that three out of four US citizens expect prices to increase in the months ahead. Some 57 percent of poll respondents of the survey said they opposed the new tariffs, which include levies of at least 10 percent on imports from almost every country.

The makers of Italy's Parmigiano Reggiano cheese say the new tariffs mean US consumers will pay more for their crumbly pasta topping.

"Americans continued to choose us even when the price went up" after an earlier round of Trump tariffs in 2019, said Nicola Bertinelli, president of the Parmigiano Reggiano Consortium. "Putting tariffs on a product like ours only increases the price for US consumers, without protecting local producers."

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The Consumer Brands Association in the US, which represents big food companies like Coca-Cola and consumer product makers like Procter & Gamble, warned that though its businesses make most of their goods in the US, they now face tariffs on critical ingredients — like wood pulp for toilet paper — that must be imported because of domestic scarcity.