President Donald Trump announced a 50% tariff threat on EU imports in late May 2025 but delayed implementation until July 9 in Washington, D.C. Wall Street coined the “TACO trade” acronym to describe Trump’s recurring pattern of imposing tariffs then quickly retreating amid market pressure and uncertainty.
This pattern has caused significant market volatility, with stocks plunging on tariff threats and rallying on tariff delays, as seen in the recent S&P 500 gains. Trump rejected accusations of “chickening out,” calling it “negotiation” and emphasizing that tariff threats have brought the EU and China to the bargaining table.
While the tariff pauses buoy markets, experts warn ongoing trade tensions and policy volatility pose uncertain long-term risks to global economic growth.
