Markets plunge after Trump threatens new China tariff hike
- Author: Sonia Alvarado May 07, 2019,
May 07, 2019, 0:48
It rose 10 cents on Friday to $70.85 per barrel.
Blowing up planned trade negotiations, tanking the stock market, undermining the US economy, and foisting more and higher taxes on American consumers and businesses is...well, it's an odd thing for a president facing re-election to do.
Chinese government offices did not immediately respond to requests for comment on Trump's suggestion the USA would raise import taxes on $200 billion in Chinese products to 25% from 10% as of Friday.
In the latest development, Trump on Sunday said those increases could now take effect on Friday and that he would target a further $325 billion of Chinese goods "shortly". It has not been confirmed if Liu He will be leading the delegation.
The posts came just days before scores of Chinese officials were expected to arrive in the US this week, with negotiators hoping to end the trade war between the countries.
Washington and Beijing have engaged in reciprocal tariff hikes over the previous year while negotiators have engaged in lengthy trade talks, alternating negotiations between the two capitals.
Stock markets sank and oil prices tumbled as negotiations were thrown into doubt.
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"If the negotiation collapses, there will be a negative impact on global financial markets with a high risk of corrections", he added. But this fear is being balanced out by a statement from China's foreign ministry on Monday that a delegation was still preparing to go to United States for trade talks.
On Sunday, Trump threatened on Twitter to increase tariff rates on $200 billion in imports from China to 25%, up from 10% now. While "great progress" has been made in the talks, structural and enforcement issues remained, he said.
Tariffs on Chinese goods are actually paid to the United States by the companies importing the goods, and most of those companies are USA -based. The Trade Deal with China continues, but too slowly, as they attempt to renegotiate, " the president continued.
He said the opposing party will not be successful if it moves forward with impeachment, based on his economic record, in spite of the worldwide stock selloff connected to his rage-tweeting at China. The White House and the U.S. Trade Representative's Office declined to comment. Since the trade dispute started, electronics coming from China have had a 10% tariff imposed on them, which means that the new tariff on electronics will increase by two and a half times. The president even defanged his own threat to blow up the North American Free Trade Agreement by agreeing to a slightly changed deal with Canada and Mexico and then not even trying very hard to get Congress to ratify the changes.
The US president's actions took investors by surprise as he tweeted his intentions on Sunday, as hopes had been growing of progress in trade talks between the United States of America and China.
The motorcycle manufacturer said European Union and China tariff-related costs were $23.7 million in 2018 and are expected to range between $100 million and $120 million in 2019.
Apparently catching Beijing by surprise, Mr Trump said he would raise import taxes on $US200 billion ($NZ302 billion) in Chinese products to 25% from 10%.
"Our biggest competitor in my view is probably China in terms of who's going to win the 21st century", Khanna said.