The Trump administration has followed through on a threat to add a 50% tariff on Chinese goods, in addition to 34% reciprocal tariffs, raising the overall tariff rate on Chinese goods to 104%.
The steep new duties on China and 184 other US trading partners took effect at 12:01 a.m. ET on Wednesday.
The tariff increase headlined a deterioration in US-China trade relations Tuesday, with China vowing to “fight to the end” in the renewed trade war after Trump threatened the new duties in response on Monday to China’s initial retaliation. “It was a mistake for China to retaliate,” White House press secretary Karoline Leavitt asserted on Tuesday.
The tariff back-and-forth continued roiling US stocks, which had been rallying on a Treasury Secretary Scott Bessent-led push to start talking about negotiations. The major indexes took an afternoon U-turn amid the China developments, ending in the deep red.
On Tuesday Trump claimed that China, as well as other countries, are keen to negotiate. Those talks have reportedly begun with Japan and South Korea. Speaking at the White House on Monday afternoon, Trump said: “We’re going to get fair deals and good deals with every country, and if we don’t, then we’re going to have nothing to do with them.”
Various countries are still deciding how to respond (or not), and companies have begun adjusting to the new reality — largely by raising prices. Some countries responded with new tariffs of their own: Canada has announced new duties on certain vehicles imported from the US, while the EU is preparing an initial set of countermeasures. The tariff rate applied to the 27-nation bloc of EU countries under the policy is 20%, and about 70% of the EU’s exports to the US are covered.
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