USA stock futures fall after Trump announces new round of tariffs

Devin Lawrence
September 18, 2018

The Trump administration is imposing tariffs on $200 billion usa more in Chinese goods starting next week, escalating a trade war between the world's two biggest economies and raising prices on consumer goods ranging from handbags to bicycle tires.

White House economic adviser Larry Kudlow announced during an interview on Monday that President Donald Trump would likely be imposing new tariffs on a "couple hundred billion" worth of imports from China.

Sohn said he believed China will retaliate against every USA tariff and the tit-for-tat exchanges will escalate until the U.S.is taxing all Chinese imports - $524 billion previous year.

Earlier yesterday Mr Trump claimed that the consequences of the global trade... The US is trying to negotiate a new North American trade deal even as it threatens to impose national security tariffs on imported automobiles, especially those from Europe.

The Chinese are expected to retaliate with commensurate tariffs on $60 billion in United States goods, and may withhold vital raw materials to USA firms.

"An escalating trade conflict serves no one's interests", Geng said.

The administration held six days of public hearings on the proposed $200 billion round of tariffs in August, which were dominated by companies warning that the United States no longer had the capacity to produce replacement products for the Chinese imports that would be hit by tariffs.

If the administration pursues what it calls "phase three" of the tariff strategy, it would raise the total value of affected Chinese goods to $517 billion - covering almost everything China sells the United States.

That would mean imposing new taxes on all of the goods the U.S. imports from China.

President Trump intends to impose tariffs on $200 billion of China's exports to the USA this week, according the Wall Street Journal.

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Trump administration does not want to constrain China's growth, development. That is below the 25 percent the administration said it was considering for this possible round of tariffs.

While consumer technology products are expected to get hit with additional taxes, some Apple products - including the company's watch and ear buds - will be exempt, according to a Bloomberg report.

Chinese authorities have yet to confirm what steps aside from retaliatory tariffs they might take.

"Our concern with these tariffs is that the U.S. will be hardest hit, and that will result in lower United States growth and competitiveness and higher prices for USA consumers", Apple said in a letter commenting on the proposal. Some companies are looking to move out of China to dodge the tariffs, said Ted Murphy, a partner at the Baker McKenzie law firm.

Trump has also complained about America's gaping trade deficit - $336 billion previous year - with China, its biggest trading partner.

A Treasury spokesman did not immediately respond to a query on the status of the China talks invitation.

Officials in Beijing have already announced that they will retaliate against the USA if the new levies are imposed. Japan has informed the WTO that it plans to impose retaliatory measures on United States goods to the tune of 50 billion yen (US$455 million). "We don't have anything to announce to you today, in terms of any of the logistics of that, but, as the President has said, we are open to that and we hope that China will come to the table and address the concerns that we have raised", the official said. This was made clear earlier this year when Washington designated China as a "strategic competitor", that is, a potential military enemy.

His comments are likely to further rattle USA businesses, which have pleaded with the administration to abandon the tariffs and warned they will raise prices, cost jobs and hurt the US economy.

"It's a very hard policy decision on China's part to find just the right touch to do this, and they are still sorting this out", he said.

Turkey has in turn hiked tariffs on imports of several USA products such as rice, alcohol, leaf tobacco, cosmetics and cars.

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