President Trump increased tariffs on China to 125 percent on Wednesday, focusing his trade war for the time being on the world’s two largest economies and seeking to rally other countries against China.
Trump issued a 90-day pause for “reciprocal” tariffs on the rest of the world following a spike in the bond market Tuesday while ratcheting up tariffs on China, which vowed this week to fight the U.S. trade war “to the end.”
“This was driven by the president’s strategy,” Treasury Secretary Scott Bessent said Wednesday. “He and I had a long talk on Sunday, and this was his strategy all along.”
“You might even say that he goaded China into a bad position. They responded. They have shown themselves to be the bad actors,” Bessent added.
After Trump announced an effective 54 percent tariff on Chinese imports last week and then ramped that up to 104 percent this week, China responded by issuing an 84 percent tariff on U.S. exports. Trump responded Wednesday to that escalation by increasing Chinese tariffs to 125 percent.
“The world is ready to work with President Trump to fix global trade, and China has chosen the opposite direction,” Commerce Secretary Howard Lutnick said on social platform X.
Prior to the Wednesday escalation, China had vowed to fight the Trump administration’s tariffs “to the end.”
“If the U.S. decides not to care about the interests of the U.S. itself, China and the rest of the world, and is determined to fight a tariff and trade war, China’s response will continue to the end,” Foreign Ministry spokesperson Lin Jian said Wednesday.
In his social media post announcing the 90-day pause and the increased China tariffs, Trump accused China of mistreating both the U.S. and other countries.
“China will realize that the days of ripping off the U.S.A., and other countries, is no longer sustainable or acceptable,” he wrote.
Trump further distinguished China from countries that hadn’t directly retaliated against U.S. tariffs but sought to negotiate instead.
“More than 75 countries have called representatives of the United States … to negotiate a solution to the subjects being discussed relative to trade … [and] these countries have not, at my strong suggestion, retaliated in any way, shape, or form,” he added.
While markets and investors breathed a sigh of relief at Trump’s overall deescalation Wednesday, investors still see a more focused U.S.-China trade war as having the potential for a lot of disruption.
“There’s a point until which China is pretty much in the driver’s seat,” Westwood Capital managing partner Dan Alpert told The Hill. “Obviously Trump has blinked, and the markets were looking for that blink.”
Analysts for Fitch said trade relations between the U.S. and China were in uncharted territory and that future negotiations on economic and military matters could be undermined by the recent deterioration.
“Tariffs on China have reached unprecedented levels, prompting retaliatory measures and raising questions about future trade deals or geopolitical negotiations,” they wrote.
They added that the tariffs could accelerate the process of “de-coupling” the U.S. economy from the Chinese economy, something analysts in Washington have long been watching out for and that many have been cautioning against.
Earlier this week, Trump said he was hoping to get a call from China to renegotiate trade terms, but the midweek escalation signals the call likely hasn’t happened or, if it did, it didn’t go well.
“We are waiting for their call. It will happen!” Trump said in a post on social media. Following the post, a senior administrative aide reportedly cast doubt on Beijing’s interest in negotiating.
While the “reciprocal” tariffs have been paused, the 10 percent general tariff and the intensification with China are sources of intense concern for business and lawmakers — especially those from states with a lot of agricultural industry that are likely to bear the brunt of further retaliation.
Sen. Thom Tillis (R-N.C.), a member of the Senate Finance Committee, told U.S. Trade Representative Jamieson Greer this week he was looking for a throat “to choke” if Trump’s trade war didn’t go well.
“I’ll look to you to figure out if we’re going to be successful,” he told Greer. “If you don’t own the decision, I’m just trying to figure out whose throat I get to choke.”
Sen. Chuck Grassley (R-Iowa), who has co-sponsored legislation to rein in Trump’s trade powers, said Tuesday that he thinks Congress has “delegated too much authority to the president.”
“I believe that Congress delegated too much authority to the president in the Trade Expansion Act of 1962 and Trade Act of 1974,” Grassley said.
Sen. Maria Cantwell (D-Wash.) said her bill with Grassley would put Congress back in charge of trade policy.
“This bill reasserts Congress’s role over trade policy to ensure rules-based trade policies are transparent, consistent, and benefit the American public,” she said in a statement introducing the legislation.
Sylvan Lane contributed reporting.
