Trump: All Chinese products are subject to the existing 20% Fentanyl Tariffs - post on Truth Social

Trump: All Chinese products are subject to the existing 20% Fentanyl Tariffs - post on Truth Social

China's recent retaliation against US tariffs has further escalated the ongoing trade conflict, with the country raising its duties on American goods to 125%. This move comes in response to President Trump's decision to exempt smartphones, computers, and other consumer electronics from the hefty 145% import tariffs that have been imposed on Chinese products. The US administration has since clarified that these electronics will be subject to separate tariffs under the national security tariff regime.

Trump, in a post on his Truth Social platform, reiterated that there were no exemptions for these products. Instead, they are now moving to a different "Tariff bucket" under the existing 20% Fentanyl Tariffs. This clarification has been met with mixed reactions, as it contradicts the initial exemption announced by the US Customs and Border Protection office. The Trump administration has been grappling with the perception that it has been granting exemptions to certain products, which has caused confusion among investors and businesses.

The US has also initiated a 90-day pause on steep Liberation Day tariffs and matched the EU's pause on retaliatory duties. However, the baseline 10% tariff that went into effect on April 5 remains in place for all affected imports into the US. The USMCA agreement allows for tariff-free imports of compliant goods between the US, Mexico, and Canada, while non-compliant goods are subject to a 25% tariff, except for energy and potash, which are tariffed at 10%.

China has described the exemption as a "small step" in correcting a "wrong practice" and has urged the US to completely cancel its tariffs. The Chinese Commerce Ministry has called on the US to return to the "right path of mutual respect." Meanwhile, the US is evaluating the impact of the exemption and plans to introduce specific tariffs targeting smartphones, computers, and semiconductors.

The ongoing trade war has had a significant impact on global markets, with US stocks roiling in response to the escalating tariffs. The uncertainty surrounding the Trump administration's tariff policies has also weighed on investor sentiment. Despite the 90-day pause on some tariffs, the baseline 10% tariff and the potential for new tariffs on electronics and semiconductors continue to pose risks to businesses and consumers.

As the trade conflict persists, the focus remains on the negotiations between the US and China, as well as other nations. The US has been engaging in active talks with the UK, EU, India, Japan, South Korea, Indonesia, and Israel, aiming to secure meaningful bilateral trade deals before the 90-day pause expires. The outcome of these negotiations will be crucial in determining the future trajectory of the trade war and its impact on the global economy.

Investors and financial professionals should closely monitor the developments in the US-China trade conflict, as well as the ongoing negotiations between the US and other nations. The uncertainty surrounding the Trump administration's tariff policies and the potential for new tariffs on electronics and semiconductors poses risks to businesses and consumers. However, the 90-day pause on some tariffs and the ongoing negotiations may provide some relief in the near term.