China strikes back with 125% tariffs on American goods

China has escalated its trade war with the U.S. by raising tariffs on American goods to 125% from 84% in response to President Trump’s increase of U.S. tariffs on Chinese imports to an effective rate of 145%.

American goods hit

The Chinese finance ministry stated that such high tariffs render U.S. goods uncompetitive in China and warned that further U.S. tariff hikes would be ignored. Both nations appear to have reached a peak in tariff escalation, with no immediate plans for further increases. Economist Zhiwei Zhang suggests that the focus will now shift to assessing economic damage and potential disruptions to global supply chains, with no indication of imminent negotiations.

Notably, China has not introduced additional export controls or expanded its “unreliable entity list” targeting U.S. firms, diverging from previous retaliatory tactics.

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