The trade conflict between the United States and China entered a volatile new phase on Tuesday after the White House confirmed a sharp escalation in tariffs on Chinese imports, according to The Street.
According to Fox Business correspondent Edward Lawrence, “the White House press secretary stated that the 104% additional tariffs came into effect at noon Eastern Time because China did not back down on its retaliatory measures. Additional customs duties will be collected by 104% starting tomorrow, April 9.”
The effensive new tariffs come on the heels of President Trump's threat last week to impose punitive measures if China does not backtrack on its 34% retaliatory tariffs. Beijing refused, sparking a reaction that intensified the trade confrontation that is already shaking global markets.
China's Commerce Ministry called the move a “recurring mistake” and vowed to “fight to the end.”
The markets were quick to respond. Bitcoin (BTC), which rose to US$109,000 after Trump's inauguration in January, fell to $77,657 on Monday, a stunning decline that reduced the so-called “Trump rise” in the cryptocurrency market to just 15%. Ethereum (ETH) also fell to US$1,504, a sharp decline as well.
With inflation remaining still, high unemployment, and declining consumer confidence, the possibility of an all-out trade war raises serious fears of an economic recession caused by economic policies.
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