3h ago
01.47 EDT
Interim
summary
Hello and
thanks for following our live coverage of what has been a rocky few days on
global markets following President’s Trump’s shock announcement of punitive
reciprocal tariffs, and now a 90-day pause for most countries, with the
exception of China.
Tensions
between the world’s two largest economies escalated today with China’s 84%
tariffs on US imports coming into effect just hours ago.
The move
was in response to Trump’s decision to hike tariffs on China to 125%.
Here is
quick recap of developments to bring you up to speed.
China’s
countermeasures against the US came into effect just after midday in Beijing on
Thursday in retaliation against Trump’s tariff hike on Chinese imports to 125%.
Beijing has vowed to “fight to the end”, refusing to back down in the face of
Trump’s efforts to bring the world’s governments to the negotiating table. The
country’s commerce minister has described the tariffs as “a serious
infringement of the legitimate interests of all countries”.
After
days of seemingly doubling down on his position, Trump announced a 90-day pause
on the proposed reciprocal tariffs for most countries, except China. Asked
about his stunning U-turn, Trump said: “Well, I thought that people were
jumping a little bit out of line. They were getting yippy. They were getting a
little bit afraid.”
Asian
markets, from Tokyo, to Hong Kong and Shanghai, responded positively to Trump’s
tariff reprieve, with stocks rising across the board. The Hang Seng Index has
climbed over 3%, or 632 points, to 20,896.95, while the Shanghai Composite
Index jumped 1.29%, or 41.03 points, to 3,227.84.
Global
markets also surged after Trump announced his 90-day tariff pause. The S&P
500 surged 9.5%, while the Nasdaq jumped 12%.
Despite
the market rebound, the head of the World Trade Organization said the US-China
tariff war could cut trade in goods between the two countries by 80%. Given the
two economic giants account for 3% of world trade, the conflict could “severely
damage the global economic outlook”, Ngozi Okonjo-Iweala said.
Addressing
reporters at the White House, treasury secretary Scott Bessent said the latest
changes in Donald Trump’s tariffs policy was Trump’s “strategy all along.” He
said: “This was his strategy all along, and that you might even say that he
goaded China into a bad position, they responded.”
China and
the US have traded tit-for-tat tariff hikes repeatedly over the past week. “I
want to emphasize that there is no winner in a trade war, and that China does
not want a trade war. But the Chinese government will by no means sit by when
the legitimate rights and interests of its people are being hurt and deprived,”
an official of China’s ministry of commerce said in a statement on Wednesday.
The
tariff reprieve has been welcomed in South Korea, Taiwan, and Vietnam, where
governments have said the pause will allow them “breathing room” and time to
negotiate with the Trump administration.
China and
the European Union have exchanged views on strengthening their economic and
trade cooperation in response to US tariffs, the Chinese commerce ministry said
on Thursday. In a video call on Tuesday, China’s commerce minister Wang Wentao
discussed with European trade and economic security commissioner Maros Sefcovic
the restart of talks on trade relief and to immediately carry out negotiations
on electric vehicle price commitments.
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