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Trump's trade war with China shows no sign of slowing down, and it's likely to get even uglier
President Donald Trump's latest round of tariffs on $200 billion worth of Chinese goods indicates that the trade war with China isn't slowing down anytime soon. And given recent threats from both sides, the trade war is only likely to get worse.
The trade war between the US and China has escalated in recent days, and the likelihood of a near-term solution is quickly fading.
President Donald Trump's latest round of tariffs on roughly $200 billion worth of Chinese goods kicked in on Monday, bringing the total amount of Chinese goods faced with tariffs up to approximately $250 billion. In response, Beijing slapped tariffs on another $60 billion worth of US goods.
The new tariffs will likely push up prices for US businesses and consumers, according to economists, while also weighing on consumer confidence. It is unclear the degree to which the inflation would weigh on the broader US economy, but most experts expect the tariffs to be somewhat of a drag on growth.
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The latest round of tariffs and reactions from Washington and Beijing have made it clear: the trade war isn't going to end anytime soon:
- China called off planned talks
- Trump has been already saber rattling
- about another slate of tariffs on the remaining $267 billion worth of Chinese imports.
While tariffs have grabbed the headlines, the fight could spill out of direct trade channels. One of the reasons that China decided to cut off talks, according to reports, was the US State Department's crackdown on China's defense agency for purchasing goods from a sanctioned Russian arms exporter.
The news website Axios also reported Sunday that the Trump administration plans to begin a public-relations campaign attacking the Chinese on security issues. According to the report, the US will highlight Beijing's alleged attacks, ranging from election interference to intellectual property theft.
Isaac Boltansky, a policy analyst at the research and trading firm Compass Point, said the broadside against China and continued threats of tariffs could trigger a more forceful response from Beijing.
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"China’s retaliation this round was consistent with expectations, but there is a growing concern that China may choose to employ a broader suite of retaliatory countermeasures (e.g., higher comparative tariff rates, stalled regulatory approvals, brand boycotts, currency devaluation, [selling US Treasurys]) in subsequent rounds," Boltansky wrote.
While Trump and Chinese President Xi Jinping are not expected to speak at this week's meeting of the UN General Assembly, there is a chance talks could resume in the coming months during the summits.
Any talks would be encouraging, according to
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