XRP (CRYPTO: XRP) is seeing big gains in Wednesday's trading. The cryptocurrency had risen 14% over the previous 24 hours of trading as of 6 p.m. ET. Over the same period of time, Bitcoin and Ethereum were up 8.4% and 13.7%, respectively.
XRP and other cryptocurrencies surged today after President Trump announced a big shift in U.S. tariff policy. For the next 90 days, reciprocal tariffs on all countries, with the exception of China, will be suspended. It would be an understatement to say that investors are happy about the news.
XRP sees strong valuation rebound on news of tariff delays
Reciprocal tariffs on a select list of countries went into effect at midnight yesterday, but they didn't last for long. President Trump announced today that he had suspended reciprocal tariffs for the next 90 days. The baseline 10% tariffs on all goods imported from other countries remain in effect, but the delay means that import taxes on goods from many countries over the next three months will be significantly lower than previously anticipated. On the other hand, Trump announced that his administration was actually raising import taxes on Chinese goods -- with the level set to increase from 104% to 125%.
What's next for XRP?
Macroeconomic dynamics will likely continue to be XRP's single biggest valuation catalyst for the foreseeable future. Investors are understandably relieved with the recent news that tariffs will be lower than expected for the next few months, and the implementation postponement suggests that the U.S. may be able to come to trade agreements with other countries. If so, it could do a lot to help push cryptocurrency valuations higher as the year progresses. On the other hand, relations with China are continuing to worsen, and investors should understand that more big curveballs could still be on the way.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and XRP. The Motley Fool has a disclosure policy.
