China will raise tariffs on all US goods to 125%, up from 84%, effective from Saturday. The new tariff now matches the so-called "reciprocal" levy the US imposes on Chinese imports, although Beijing said it won't go any higher. If we count tariffs the US previously imposed on China, the current rate on imported goods is 145%. "Even if the US continues to impose higher tariffs, it will no longer make economic sense and will become a joke in the history of world economy," said the Finance Ministry in a statement. "At the current tariff level, there is no market acceptance for US goods exported to China. If the US continues to play the tariff numbers game, China will ignore it. However, if the US insists on continuing to substantially infringe on China's interests, China will resolutely counterattack and fight to the end," it continued. Ahead of the US markets opening, the S&P 500 and Dow Jones fell in response to the news, extending a week of market volatility. The dollar slipped almost 2% against the euro shortly after China's announcement. After announcing a wide array of "reciprocal" tariffs on 2 April, President Trump earlier this week paused the majority of these levies for 90 days, leaving in place a 10% baseline tariff on affected countries. China was nonetheless excluded from Trump's clemency, as the president announced that he would be raising tariffs on the country 125% — after Beijing imposed an 84% levy. "Based on the lack of respect that China has shown to the world's markets, I am hereby raising the tariff charged to China by the United States of America to 125%, effective immediately," Trump said in a social media post. The president's decision to halt the bulk of his "Liberation Day" package came after bloodshed on the stock market and an unusual spike in bond yields. Investors typically flock to US Treasuries in times of uncertainty as they are seen as a safe haven asset. As a result, the sell-off led some analysts to wonder whether Trump's policies were damaging the long-held supremacy of US government debt, thus increasing state borrowing costs. "I thought that people were jumping a little bit out of line," Trump told reporters when explaining his tariff pause. "They (investors) were getting a little bit yippy, a little bit afraid." China owns around $759 billion (€666.27bn) of US bonds, making it the world's second largest holder behind Japan. Beijing has been looking around for foreign allies as the US targets it with restrictive trade policies, hoping to build a united front against Trump's tariffs. "A just cause receives support from many," Chinese Foreign Ministry spokesperson Lin Jian said at a daily briefing on Thursday. "The US cannot win the support of the people and will end in failure," he said. China's Premier Li Qiang has already discussed the escalating trade war over a phone call with European Commission President Ursula von der Leyen. Even so, nations that share previous grievances with China may be unwilling to link up with Beijing. The total value of trade in goods between the US and China was almost $700bn (€613.3bn) in 2024. — Euronews
