Asian shares advance on relief that Trump is delaying higher China
tariffs
[August 12, 2025] By
YURI KAGEYAMA
TOKYO (AP) — Asian shares mostly advanced Tuesday after President Donald
Trump delayed raising tariffs on China for another 90 days.
Tokyo's benchmark Nikkei 225 jumped 2.2% to 42,718.17, topping its past
all-time record. Toyota Motor Corp.'s shares surged nearly 3% and other
heavyweight shares also saw big gains after the U.S. confirmed that
tariffs on imports from Japan would be taxed at 15% and not subject to
“stacking” the rate on top of already existing duties.
Hong Kong's Hang Seng rose 0.3% to 24,979.55, while the Shanghai
Composite climbed 0.5% to 3,665.92.
Trump signed an executive order Monday putting on hold a possible
showdown between the world’s two major economies to allow time for more
talks on a broad trade agreement. Without an extension, taxes on Chinese
imports might have jumped from an already high 30%.
Beijing could have responded by raising retaliatory levies on U.S.
exports to China but it issued a similar statement about the extension
of the tariff pause.
The reprieve makes room for a possible deal with Trump, but it also
prolongs the uncertainty that has bedeviled companies since the
president began escalating his trade war.
“The extension isn’t about goodwill; it’s about keeping oxygen in the
room for deals that matter,” Stephen Innes of SPI Asset Management said
in a commentary.
Elsewhere in Asia, Australia’s S&P/ASX 200 rose 0.3% to 8,880.80. South
Korea’s Kospi lost 0.5% to 3,189.91.
On Monday, U.S. stocks edged back from their record highs ahead of an
update on U.S. inflation. The S&P 500 dipped 0.3% to 6,373.45 after
flirting with its all-time high, which was set two weeks ago.
The Dow Jones Industrial Average dropped 0.5% to 43,975.09, and the
Nasdaq composite slipped 0.3% to 21,385.40.
On Tuesday, the government will report how bad inflation was across the
country in July. Economists expect it to show U.S. consumers had to pay
prices for groceries, gasoline and other costs of living that were 2.8%
higher than a year earlier, a slight acceleration from June’s 2.7%
inflation.
Inflation has remained above 2%, even if it has improved substantially
from its peak above 9% three years ago. And the worry is that President
Donald Trump’s tariffs could push prices still higher.
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A person walks in front of an electronic stock board showing Japan's
Nikkei index at a securities firm Tuesday, Aug. 12, 2025, in Tokyo.
(AP Photo/Eugene Hoshiko)
 That in turn is raising fears about
a potential, worst-case scenario called “stagflation” where the
economy stagnates but inflation remains high. The Federal Reserve
has no good tool to fix both at once, and it would need to
concentrate on either the job market or inflation first. But helping
one of those areas by moving interest rates would likely hurt the
other.
A top Fed official, Michelle Bowman, said on Saturday that she
believes the job market is the bigger concern. She is still backing
three cuts to interest rates by the Fed this year following this
month’s stunning, weaker-than-expected report on the U.S. job
market. Trump has also been angrily calling for cuts to interest
rates to support the economy.
Other Fed officials, led by Chair Jerome Powell, have been more
hesitant. Powell has said he wants to wait for more data about how
Trump’s tariffs are affecting inflation before the Fed makes its
next move, and Tuesday’s update on the consumer price index may
offer a big clue about that.
The price of gold eased after Trump said he would not place tariffs
on the metal. That followed a brouhaha Friday in the gold market
after the U.S. Customs and Border Patrol seemed to rule that some
kinds of gold bars coming from Switzerland would face a tariff. That
caused a disconnect between the prices of gold trading in New York
versus in London, but the market has since calmed.
Gold for December delivery settled at $3,404.70 per ounce in New
York, down 2.5%. Early Tuesday, it was down 0.3% at $3,394.00.
In other dealings early Tuesday, benchmark U.S. crude rose 12 cents
to $64.08 a barrel. Brent crude, the international standard, added
19 cents to $66.82 a barrel.
In currency trading, the U.S. dollar edged up to 148.33 Japanese yen
from 148.15 yen. The euro cost $1.1614, down from $1.1618.
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