Trump's tariff ultimatum sends shockwaves through markets
U.S. President Donald Trump threatened on Monday to impose an additional 50% tariff on China on Wednesday if Beijing does not retract its retaliatory tariffs announced on Friday.
"Yesterday, China imposed retaliatory tariffs of 34%, in addition to already established record tariffs, non-cash tariffs, illegal subsidizing of companies, and massive, long-term currency manipulation, despite my warning that any country taking retaliatory actions against the USA will immediately face new and significantly higher tariffs exceeding those initially established," wrote Donald Trump on his social media platform, Truth Social.
Trump threatens China
"Therefore, if China does not retract its 34% increase (...) by tomorrow, April 8, 2025, the United States will impose additional tariffs on China of 50%, effective from April 9," he added. He also announced that he would immediately end trade talks with China, while "negotiations with other countries, which have also requested meetings, will begin immediately."
If Trump fulfills his threat and the new 50% tariff is added to those already announced, it would mean that the base rate for almost all goods from China would be 104%.
Contrary to what Trump said, China announced retaliatory tariffs of 34% (equal to those announced by the U.S. President last Wednesday) on Friday, and they are set to take effect on April 10. According to the White House plan, "reciprocal" tariffs for goods from countries with trade surpluses with the USA will take effect on April 9. Already on Saturday, a 10% tariff was implemented for almost all countries worldwide.
Trump's announcement intensified fluctuations on Wall Street. Earlier, for a few minutes, all New York Stock Exchange indexes surged sharply after markets reacted to a misleading—as it later turned out—headline about a statement by Trump's advisor, Kevin Hassett, on a possible 90-day suspension of tariffs on all countries except China. Hassett was asked about this in an interview with Fox News but only responded that Trump "will do what he will do."
After the White House refuted the suspension of tariffs, stock prices fell sharply again. The Dow Jones index is currently down 1.7%.
