In a tit-for-tat move, China has hit back at the US by imposing an 84% tariff on all American goods, in retaliation for the US imposing a 104% tariff on Chinese goods. The Chinese Ministry of Finance announced that, starting April 10, it will implement these new, higher tariffs on imports from the United States. According to news agency Reuters, this step is a direct response to the recent US tariff hikes.
The tariff rate (the percentage of tax on imported goods) that China will charge on American goods has increased from 34% to 84%, showing a significant escalation in the trade conflict between the two countries.
Why China Made This Move Against US
On April 2, the US President announced a new round of tariffs, stating that America would now impose a minimum 10% tax on nearly all its trading partners. He also introduced higher tax rates for countries that, according to him, have a trade surplus with the US. These increased import duties on dozens of countries and territories officially came into effect at midnight on Wednesday.
Also Read: US-China Tariff Showdown! China To Pump Stimulus Into Stocks As US Tariff Bites – Nomura
US-China Trade War
Donald Trump imposed a steep 104% tariff on Chinese goods a day back, prompting China to respond with what it called “countermeasures.” Beijing made it clear that it would not give in to what it described as “tax blackmail” by the US. In retaliation, China imposed a 34% tariff on American goods, further escalating the trade tensions between the two countries. Trump has accused other nations of unfairly taxing US products and exploiting the American economy for their own gain.
What Next In US Stock Markets
US stock markets have continued to fall, dropping for the fourth day in a row since Trump announced new tariffs. The S&P 500, a major US stock index, closed below 5,000 points for the first time in nearly a year. It has now fallen by 19% from its recent peak on February 19. If it drops just 1% more, it will officially be in a “bear market,” which means a decline of 20% or more. In just the past week, companies listed on the S&P 500 have lost a combined $5.8 trillion in value. Asian markets, including Japan’s Nikkei and India’s Sensex, are also seeing heavy selling and preparing for further losses.
