Published: Sat, August 03, 2019
Money | By Ethel Goodwin

Do consumers really have to worry about Trump's latest China tariff threat?

Do consumers really have to worry about Trump's latest China tariff threat?

Apple shares, Nasdaq's biggest component, lost more than $40 billion in market value after President Donald Trump took to Twitter on Thursday and threatened to slap a 10% tariff on $300 billion in goods the US buys from China by September 1 if trade talks between the countries fail to make progress.

Some analysts assert Trump chose to take this action in a blatant attempt to force the U.S. Federal Reserve to further cut interest rates in September. She didn't elaborate on what the measures would be.

USA business groups in China expressed disquiet over the latest round of U.S. tariffs.

"Imposing new tariffs is absolutely not the right solution to trade frictions", he told a local Chinese television station while attending an Asean meeting in Bangkok.

The day's 300-point gain in the Dow Jones Industrial Average was largely erased following the announcement. It had been as high as 0.89% as recently as January. Officials from Xi downward disappear from public view as they privately debate policy.

It was the first sale to a private buyer since Beijing offered to exempt five crushers from the 25-percent import tariffs imposed more than a year ago.

Another meeting was scheduled next month (September) in Washington. "Deal or no deal, China is prepared for the worst-case scenario".

Oil prices rose more than 2% on Friday, regaining some ground after their biggest falls in years on U.S. President Donald Trump's threat to impose more tariffs on Chinese imports. "Until such time that there is a deal, we will be taxing the hell out of China".

Having spent most of the session on track for their best day since June, all three major United States stock indices took sudden U-turns as investors quickly turned into sellers after the tweet.

By setting the import taxes at 10 per cent, he has leeway to ratchet them higher if necessary to further increase pressure on Beijing. Trump's earlier tariffs had been created to minimize the impact on ordinary Americans by focusing on industrial goods.

USA and Chinese negotiators ended two days of talks in Shanghai on Wednesday with little sign of progress, although both countries described the negotiations as constructive.

Joshua Mahony, a senior market analyst at the financial trading firm IG, said: "Hopes of a resolution to the US-China trade war have been dashed once again. Because what they do is, they devalue their currency and they push money out", he said.

A large majority of the tariff increase will impact consumer goods sourced from China ranging from smartphones to apparel.

But they also said the president and his advisers had grown increasingly wary of what appeared to be China's efforts to extend the talks into next year with an eye toward a possible change of administration after the 2020 presidential elections.

'We want free and fair trade, not trade that undermines competition, ' Pompeo told a regional youth leadership program in the Thai capital Bangkok, where he is attending a wider meeting of Southeast Asian nations with world powers.

Since it was around 1 a.m.in Beijing at the time, Lighthizer said it might be hard to get him on the phone, the sources said.

The American president widened the ongoing trade war just hours after China's Ministry of Commerce discussed the results of two days of high-level talks earlier this week in Shanghai. You can find a full list of products here.

"The goods that are now going to be targeted are ones that would affect ordinary consumers", says Seth Sutel, business writer for the Associated Press. Exporters sometimes, for instance, may offer USA importers a discount to help defray the costs of higher US duties and maintain their contracts and market share.

"China's position is very clear that if United States wishes to talk, then we will talk, if they want to fight, then we will fight", Zhang told reporters in NY, also signalling that trade tensions could hurt cooperation between the countries on dealing with North Korea.

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