China trade war escalates as Beijing returns fire

China defiant as Trump adviser admits US consumers pay tariffs

Kudlow said China needs to agree to'very strong enforcement provisions for an eventual deal

The remarks may also help him deflect blame onto the Fed if the escalating trade dispute causes the US economy to stumble as he seeks reelection in 2020.

The spree of editorials and commentaries in China's state media on Monday (May 13) and Tuesday ramped up attacks on Washington and its trade tactics, with Beijing rolling out the propaganda campaign in sync with its retaliation on U.S. goods.

In reaction to the announcement by China, US equity futures tumbled with the S&P 500 down 1.8%, while the US Dollar also dropped.

The Chinese foreign ministry on Tuesday said it had "no information to offer at present" on a possible meeting between president Xi Jinping and his U.S. counterpart to avert a trade war.

'I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don't make a deal because companies will be forced to leave China for other countries.

Earlier, Trump said an agreement could be reached "when the time is right" but not unless Washington can narrow last year's $419 billion trade deficit with Beijing.

China says it will impose tariffs on $US60 billion ($NZ91 billion) of United States goods from 1 June, extending a bilateral trade war.

But after weeks of optimistic statements by Trump and members of his administration about how trade talks were progressing, Trump abruptly escalated tariffs on $200 billion of Chinese goods last week and opened the door to even more - prompting Beijing to hit back Monday by raising the tariff rate on $60 billion of USA items.

The move was announced in a statement by the Tariff Policy Commission of China's cabinet, the State Council.

The Trump administration has maintained tariffs are an important tool to correct unfair trading practices with China.

In other words, our dynamic, growing, low-inflation economy can handle a trade war with China.

On Friday May 10, 2019 President Donald Trump imposed sanctions on $200 billion (€178 billion) worth of Chinese goods. It was expected that Beijing would raise tariffs on US goods to 25%.

However, the higher prices will also harm American companies that will need to pay more for the parts they use and the goods they sell, and that could lead to job losses.

According to the U.S. Census Bureau, in 2018, China imported into the United States $2.09 billion in jewelry, $233 million in gem diamonds, and $1.01 billion in gemstones.

But US Treasury Secretary Steven Mnuchin told reporters on Monday he believed China would continue to buy US debt.

The list of 3,805 product categories is a step toward carrying out President Donald Trump's May 5 threat to extend punitive 25% duties to all Chinese imports, the U.S. Trade Representative announced. "China should not retaliate-will only get worse!"

Even if jewelry products didn't make that particular list, they likely won't be spared.

The best that can be said after the latest escalation in the US-China trade war is that at least the two sides are still talking. "They have not been fair traders". About 85 percent of leather ski gloves imported to the US are made in China, according to Bloomberg. That would raise the cost of an iPhone XS from $1,000 to $1,142, potentially slowing sales if consumers decide to hold off on upgrading to a new phone due to the higher costs. If tariff levels remain where they are today, the average American family is expected to pay about $770 in higher costs each year the tariffs remain in place, says Laura Baughman, a co-author of the study and president at Trade Partnerships Worldwide.

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