Published: Tue, September 03, 2019
Markets | By Otis Pena

Trump Warns China Not to Delay Trade Talks

Trump Warns China Not to Delay Trade Talks

The Trump administration on Sunday began collecting 15 percecnt tariffs on more than $125 billion in Chinese imports, including smart speakers, Bluetooth headphones and clothing.

The new 15% US duty on about $112 billion of Chinese products will hit Americans more directly than an existing 25% tax on about $250 billion of goods, targeting consumer staples ranging from footwear and apparel to home textiles, as well as technology products like the Apple Watch. A separate batch of about $160bn in Chinese goods - including laptops and cellphones - will be hit with 15% tariffs on December 15. US equity futures fell on the news, touching their lows for the day. S&P 500 futures opened 1% lower before paring losses, and Treasury contracts advanced.

But he maintained his resolve to continue the trade war.

Many Americans spend more on services-such as housing, education, and health care-than on goods, hence tariffs on Chinese products are unlikely to push annual inflation up significantly. Trump said. "This is about American Freedom".

Americans may start to feel the pinch, according to some studies. Japan announced Monday that its manufacturing spending had fallen for the first time in two years during the second quarter, which experts sees as further evidence of the trade war's dampening effect.

"The investor mood was spoiled by the United States and Chinese officials' inability to fix a date for the next face-to-face meeting that is supposed to take place in September", Ipek Ozkardeskaya, senior market analyst at London Capital Group, said in a morning note.

The trade tariffs on China have contributed a slowing of the Chinese economy, as well as other countries' economies in the region. "The current chaos around the United Kingdom exiting the European Union threatens to push down sterling even further unless we get a clear idea of what is happening and when", Russ Mould, investment director at AJ Bell, said in a note to investors Tuesday.

Despite tariff hikes, Trump is still optimistic about the ongoing trade talks with Beijing.

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While Trump has repeatedly said China is paying for his tariffs, many companies and economists say that US importers bear the cost - and some of it is passed on to consumers.The non-partisan Congressional Budget Office in August projected that by 2020, Trump's tariffs and trade war will reduce the level of real US GDP by about 0.3% and reduce average real household income by $580. Trump later raised the new tariff on Chinese goods to a 15 percent rate rather than the initial 10 percent.

Fentanyl is a cheap, relatively easy-to-synthesize opioid painkiller 50 times more potent than heroin that has played a major role in a devastating US opioid crisis.

The tariffs are also harming the global economy.

China on Sunday imposed further tariffs on U.S. imports, in retaliation for Washington's fourth round of tariff hikes on Chinese products.

Beijing hit back immediately with measures of its own, slapping tariffs of up to 10 percent on over 1,700 U.S. goods including crude oil and soybeans.

Some of the tariffs were later delayed until December in a concession to United States retailers. It'll also resume an extra 25 percent duty on cars imported from the U.S. on December 15. With existing general duties on autos taken into account, the total tariff charged on US-made cars would be as high as 50%.

The administration of US President Donald Trump has implemented additional tariffs of about 15 percent on 110 billion dollars' worth of Chinese imports.

"While I am sure they would love to be dealing with a new administration". To take on China, there has to be a multilateral approach.

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