UK markets have begun to rebound after Donald Trump announced a 90-day pause in his sweeping tariffs, though ministers insisted they would remain cautious in the face of instability.
The FTSE 100 rose by more than 6% after stock markets opened in London on Thursday.
Following a significant rally for markets in the US and Asia, after President Trump said he would be delaying tariffs on most nations for 90 days while raising his tax rate on Chinese imports to 125%.
Amid the rising market confidence the senior Cabinet minister Yvette Cooper continued to urge caution.
The Home Secretary said, “We are seeing changes all the time. We are seeing quite a lot of global instability, we are seeing that in the economy, we are seeing it also on security, on defence issues.”
“But I think that just comes back to the approach that we have taken – it’s the plan for change” and “We are not keeping a running commentary on different trade negotiations, on the different approaches that other governments are taking.”
Cooper explained that “What we are doing is just being really steady about this. We have made clear our principles and our approach. We want to see a reduction of trade barriers and we want to negotiate good arrangements that are in the UK’s interests.”
Meanwhile, FTSE has rebounded following its downturn in earlier days, the index of the UK’s top stocks is still far below where it was in the days before Mr Trump’s tariffs came into force.
The US pause has not completely eliminated taxes on goods into America, with all countries now expected to pay a 10% levy, instead of the reciprocal rates Mr Trump’s administration had originally set out.
However, many America’s trading partners had threatened retaliatory action before the pause, like the EU, which had voted to impose countermeasures on some US goods.
The UK had been spared higher tariffs rates hitting others and had resisted retaliatory action.
Other countries now find themselves in the same situation as the UK, which was already required to pay the 10% tariff rate.
Chancellor Rachel Reeves will seek to negotiate with the US when she visits Washington at the end of April for the International Monetary Fund’s spring meeting of global finance ministers.
She also said a UK-EU summit on May 19 would be a chance to refresh our relationship and make it easier for businesses to trade.
