Donald Trump insisted his trade war with much of the world was “doing really well” despite mounting fears of recession and as Beijing hit back and again hiked tariffs on US exports to China.
As the US president said his aggressive tariffs strategy was “moving along quickly”, a close-watched economic survey revealed that US consumer expectations for price growth had soared to a four-decade high.
The White House maintains that the US economy is on the cusp of a “golden age”, however, and that dozens of countries – now facing a US tariff of 10% after Trump shelved plans to impose higher rates until July – are scrambling to make deals.
“The phones have been ringing off the hook to make deals,” press secretary Karoline Leavitt told reporters on Friday.
Beijing raised Chinese tariffs on US products to 125% on Friday – the latest salvo of its escalating trade dispute with Washington – and accused Trump of “unilateral bullying and coercion”.
“Even if the US continues to impose even higher tariffs, it would no longer have any economic significance, and would go down as a joke in the history of world economics,” the Chinese finance ministry said.
Related: What are bonds and why have they spooked Donald Trump?
Few investors were laughing. US government bonds – typically seen as one of the world’s safest financial assets – continued to be sold off, and were on course for their biggest weekly loss since 2019. The dollar also fell against a basket of currencies, and was down against the euro and the pound.
Leading stock indices paused for breath on Friday after days of torrid trading. The FTSE 100 rose 0.6% in London. The S&P 500 increased 1.8% and the Dow Jones industrial average gained 1.6% in New York.
The S&P 500 finished an extraordinarily volatile week for markets up 5.7%, its biggest weekly gain since November 2023.
“We are doing really well on our TARIFF POLICY,” Trump wrote on his Truth Social platform. “Very exciting for America, and the World!!! It is moving along quickly. DJT”
Some of Wall Street’s most influential figures were unconvinced. “I think we’re very close, if not in, a recession now,” Larry Fink, CEO of the investment giant BlackRock, told CNBC. Far from providing certainty, the 90-day pause on higher US tariffs on much of the world “means longer, more elevated uncertainty”, he added.
Jamie Dimon, CEO of JPMorgan Chase, the US’s largest bank, said the world’s largest economy was facing “considerable turbulence” as a key measure of consumer confidence tumbled to its lowest level since the Covid-19 pandemic – and the second-lowest level on record.