China Strikes Back with Tariffs on the U.S.

U.S Dollar Slops on China Tariffs

Tensions between the United States and China escalated on Tuesday as President Donald Trump indicated he was in no hurry to engage in discussions with Chinese President Xi Jinping regarding the newly intensified trade conflict. The dispute was triggered by Trump’s decision to impose a sweeping 10% tariff on all Chinese imports.

In response, China introduced targeted tariffs on U.S. goods and issued warnings to several American companies, including Google, about potential sanctions. Additionally, Beijing announced export controls on key metals such as tungsten, which are essential for electronics, military equipment, and solar panels. As a result, the U.S. dollar edged lower following the news.

(U.S Dollar Index Daily Chart, Source: Trading View)

When asked about China’s retaliatory tariffs, Trump responded at the White House, stating, “That’s fine.” A direct conversation between Trump and Xi was widely viewed as a crucial step toward potentially easing or delaying tariff measures, similar to the discussions Trump held with Mexican and Canadian leaders a day earlier. However, White House spokeswoman Karoline Leavitt confirmed that a call between the two leaders had yet to be scheduled.

Among China’s newly announced tariffs, a 10% duty on electric trucks could impact Tesla’s Cybertruck, a model the company has been actively promoting in the Chinese market. Tesla has not yet commented on the matter. These tariffs are set to take effect on Monday, providing a brief window for both sides to negotiate a resolution. Chinese policymakers have signaled their willingness to reach an agreement, especially as domestic demand in China remains weak.

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