Cliff Notes
- China’s tariffs on exports to the US have risen to 125%, prompting speculation about potential retaliation and the future scope of trade relations.
- Despite expectations of aggressive responses, China has so far matched US actions without escalating further, indicating a desire to maintain some level of restraint.
- The breakdown of trade relations between the world’s two largest economies poses significant risks, leaving questions about future political dynamics and the implications for global markets.
China won’t back down as White House compitulates over bond markets
Another day, another escalation.
China awoke to the news tariffs on its exports to America are now at a whopping 125%, and the ball is now back in its court. Will it retaliate further?
China responding has, up until now, been expected. Leaders here have clearly decided to take a stand and they’re likely to keep seeing that through.
But there are big questions about what escalation now looks like, how far could things spiral and what, if any, are the off-ramps?
Trump gives reasons for pausing some tariffs
In a post on his Truth Social platform, Mr Trump said the “90-day pause” was for the “more than 75 countries” who had not retaliated against his tariffs “in any way”.
He added that during this period they would still have to pay a “substantially lowered” 10% tariff, which is “effective immediately”.
It is lower than the 20% tariff that Mr Trump had set for goods from the European Union, 24% on imports from Japan and 25% on products from South Korea.
The UK was already going to face a blanket 10% tariff under the new system.
Mr Trump said the increased 125% tariff on imported goods from China was “effective immediately”.
He added: “At some point, hopefully in the near future, China will realise that the days of ripping off the USA, and other countries, is no longer sustainable or acceptable.”
China’s new tariffs on US goods take effect as Asian markets rally after Trump’s tariff reversal – business live – The Guardian
Trump tariffs day 6 as it happened: US stocks soar as Washington pauses most tariffs; China hits US with retaliatory tariff of 50% – Financial Times
EU targets Trump’s red states with tariffs on US trucks, cigarettes and ice cream – politico.eu
