The trade conflict between the United States and China intensified as both nations implemented new tariffs on each other’s goods. China is urging the U.S. to de-escalate and find a resolution.
The latest round of heightened tariffs took effect on Thursday. The U.S., under President Donald Trump, increased tariffs on Chinese goods, while China retaliated by imposing 84 percent levies on specific U.S. imports.
While the U.S. increased tariffs on China, President Trump announced a 90-day pause on planned tariff hikes for most other countries. This move provided some relief to global markets, leading to a surge in stock prices on Wall Street, across Asia, and in Europe.
However, the tariffs on China escalated, with the U.S. raising them to 125 percent from the previous 104 percent.
China’s Ministry spokeswoman, He Yongqian, stated, “We hope the US will meet China halfway, and, based on the principles of mutual respect, peaceful coexistence and win-win cooperation, properly resolve differences through dialogue and consultation.” China’s foreign ministry also expressed concern about the tariff hikes, saying they were detrimental to the global economy.
President Trump has asserted that trade deals will be reached with all nations, including China. However, he also commented that Chinese leaders seem unsure about how to proceed with negotiations.
Bloomberg reported that China’s top leadership convened on Thursday to discuss potential stimulus measures to bolster the country’s economy, which was already facing challenges before the trade war escalated.
The markets have experienced volatility due to trade tensions. Initially, Trump imposed a 10 percent baseline tariff on all countries, with higher rates for specific trading partners. He then announced a 90-day pause on the higher tariffs for most nations, excluding China.
Trump defended his actions, stating that he remains flexible and that the pause was not a reversal. He acknowledged market concerns, noting that “people were getting a little queasy” as U.S. bond yields rose.
Trump’s senior trade advisor, Peter Navarro, characterized the situation as “the greatest trade negotiating day we have ever had,” suggesting that the U.S. is well-positioned to pursue trade deals with other countries.
Japan welcomed the 90-day pause but reiterated its demand for the U.S. to reconsider tariffs on its steel and auto exports. The Association of Southeast Asian Nations (ASEAN) announced they would not impose retaliatory measures and are open to dialogue. Vietnam also reported that it has agreed to begin trade agreement negotiations with the U.S.
The European Union had previously announced its countermeasures, targeting over 20 billion euros’ worth of U.S. products.
Wall Street responded positively to Trump’s announcement of the tariff pause, with the S&P 500 experiencing a significant increase. Markets in Asia also saw substantial gains.
