China has hit back at the United States by sharply raising tariffs on American goods to 84 per cent.
This comes just days after President Donald Trump slapped a 104 per cent tariff on Chinese imports, shaking global markets and pushing up UK borrowing costs.
China’s Ministry of Finance said it will add an extra 34 per cent tariff on top of the taxes already in place from April 10.
The move is a direct response to the US raising tariffs and marks a major escalation in the trade row.
Officials have also introduced new export controls on rare-earth minerals, which are crucial for technology and defence products.
On top of that, more than 20 US companies have been blacklisted, adding even more pressure to already tense relations between the two countries.
This escalation in the trade war has led to significant volatility in global financial markets.
The FTSE 100 experienced a sharp decline of 4.95 per cent, marking its worst performance since the COVID-19 pandemic.
Similarly, U.S. stock futures have dropped, with Dow E-minis down 1.87 per cent, S&P 500 E-minis down 1.72 per cent, and Nasdaq 100 E-minis down 1.45 per cent.
Economists are expressing concerns about the potential for a full-scale trade war between the world's two largest economies.
The rising tariffs are likely to affect many industries, which could mean higher prices for shoppers and disruptions to global supply chains.
The rising tariffs are likely to affect many industries,
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In the United Kingdom, the British Chambers of Commerce reported that 62 per cent of UK firms with trade exposure to the USA anticipate negative impacts from the U.S. tariffs.
Additionally, 32 per cent of these firms plan to increase prices in response to the tariffs.
Other international communities have expressed concern over the escalating trade dispute. The European Union has urged both nations to seek a negotiated solution to avoid further destabilising the global economy.
Other countries are watching closely, worried that the fallout could also hurt their own economies.
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