According to economist Maurice Obstfeld, the global economy dodged a worse tariff shock because major trading nations exercised restraint. The real turning point? When China responded strategically to US tariff moves, forcing Washington to step back from its hardline stance. That measured pushback essentially prevented a full-blown trade catastrophe. Instead of an all-out trade war that could've sent shockwaves through markets, the back-and-forth negotiation created a pressure valve—keeping supply chains and cross-border commerce from completely derailing.