US markets slide as tariffs on imports from China now hit 145%
White House clarifies that the 125% tariffs are in addition to earlier 20% levies applied for fentanyl trafficking
The higher figure includes the 125 per cent rate that covers the so-called “reciprocal” duties announced by Trump as well as a 20 per cent rate imposed earlier this year over China’s involvement in fentanyl trafficking.
The Dow Jones Industrial Average closed down over 1,000 points, or 2.5 per cent; the S&P 500 slid 3.5 per cent; and Nasdaq fell over 4 per cent.
The markets were giving back large portions of the gains they had made in the Wednesday’s historic rally, when Trump backed down on his most punishing tariffs on nations he called the “worst offenders” by postponing them for 90 days, though the baseline 10 per cent tariffs on goods from all US trading partners that he announced last week remain in effect.
At the same time, he announced the 125 per cent tariffs on China and said they would go into effect immediately.
Confirmation of the higher rate is likely to escalate the stand-off between Washington and Beijing, which became the main target of the Trump administration’s efforts to reverse America’s overall trade deficit.
Responding to the clarified tariff rate, Chinese embassy in Washington spokesperson Liu Pengyu said: “China does not want to fight these wars but is not scared of them”.