• US President Donald Trump speaks with reporters in the Oval Office of the White House during a ceremonial swearing in of Paul Atkins as Chairman of the Securities and Exchange Commission, on April 22, 2025, Washington. (AP)

Wall Street surged and global markets found some relief Tuesday after US President Donald Trump said he had no intention of firing the chair of the US Federal Reserve. He also signalled a "substantial" lowering of tariffs on China.

Trump’s recent criticism of Federal Reserve Chairman Jerome Powell had sparked concerns that he might remove him from his post, which rattled financial markets. The president had faulted Powell for stating that the White House’s broad tariffs could stoke inflation.

"I have no intention of firing him," Trump said Tuesday. "I would like to see him be a little more active in terms of his idea to lower interest rates, it's a perfect time to lower interest rates."

"If he doesn't, is it the end? No," Trump said.

The trade war between the United States and China had intensified, with Washington announcing new tariffs that could see duties on Chinese imports soar to as high as 245 percent. The White House attributed the move to Beijing's "retaliatory actions", signaling a hardening stance in the ongoing economic conflict.

Previously, Washington had imposed a 145 percent levy on Chinese goods, while Beijing responded with a 125 percent tax on American exports. 

But on Tuesday, Trump acknowledged that the current tariff levels were unsustainably high and hinted at a potential softening of the US stance.

"They will not be anywhere near that number," but "it won't be zero," the president said.

"Ultimately, they have to make a deal because otherwise, they're not going to be able to deal in the United States," he continued.

His remarks followed Treasury Secretary Scott Bessent’s comments during a closed-door session hosted by JP Morgan Chase. According to someone present, Bessent characterized the tariffs as a form of reciprocal trade embargo, which usually involves one country completely stopping trade with another but suggested a de-escalation could be on the horizon.

This news lifted investor sentiment, triggering a rally in US markets with Wall Street's indexes jumping, and a wave of gains across Asian stock exchanges on Wednesday.

'Doing very well' 

Bessent said there was much to be done at the end of the day with Beijing, but he noted the need for fair trade and said China needed to rebalance its economy.

The Treasury chief stressed that the goal is not to decouple with China, noting that container bookings between both countries have slumped recently as trade tensions heated up.

The White House also echoed optimism on the trade front.

Also on Tuesday, White House Press Secretary Karoline Leavitt told reporters that Washington is "doing very well in respect to a potential trade deal with China."

"The president and the administration are setting the stage for a deal," she added, noting that "the ball is moving in the right direction."

She said that there’s a general sense that both sides want to reach a trade deal, although China has not yet confirmed that it is in negotiations with the US.

As global finance leaders gather in Washington for the IMF and World Bank’s Spring Meetings, trade discussions are happening behind closed doors. Nations are closely watching developments as they navigate the effects of Trump’s extensive tariff policies.

At the same time, Chinese Foreign Minister Wang Yi has reached out to his British and Austrian counterparts, urging them to help support global trade stability.

In Asia, Japan is reportedly planning to send a second envoy, Ryosei Akazawa, to Washington next week, with speculation that Tokyo might offer concessions to reduce tensions with the US.