The trade wars launched by U.S. President Donald Trump have escalated to new heights.
Just days after Trump unveiled sweeping new “reciprocal” tariffs on imports from around the world, China on Friday levied a retaliatory 34% tariff on all U.S. products starting April 10. Stock markets worldwide plummeted, with the S&P 500 closing its worst week since COVID-19 upended the global economy in 2020.
Economists warn that the tariffs will raise the prices of products consumers buy each day — from the grocery aisle to car repairs. As businesses face higher costs, some say economies worldwide could see slowed hiring, layoffs and lower incomes down the road — heightening fears about future economic growth and widening inequality.
Meanwhile, Trump has doubled down on his commitment to tariffs, maintaining that his new levies will bring trillions of dollars of investment to the U.S. while also criticizing other countries' retaliatory measures.
Here's what we know about the latest developments.
What new tariffs did Trump announce this week?
Since taking office in January, Trump has rolled out several — and at times, on-and-off again — rounds of tariffs targeting particular countries and products. He's argued that raising import taxes will bring manufacturing back to the U.S. and protect domestic industries from unfair foreign competition.
None have been more sweeping than his long-threatened “reciprocal” tariffs unveiled on Wednesday.
The new tariffs will hike taxes on products imported from nearly all of America's trading partners — with Trump declaring a minimum tariff of 10% across the board and higher rates for dozens of nations that run trade surpluses with the U.S.
The steeper levies run as high as 50% — with the biggest “reciprocal” rates landing on small economies that trade little with the U.S., including the African kingdom of Lesotho. Other notable rates include a 20% tax on imports from the European Union, 25% on South Korea, 24% on Japan and 32% on Taiwan. The tariffs build on some of Trump's previous measures. His “reciprocal’’ tariff of 34% on China, for example, builds on 20% levies imposed earlier this year.
How has China responded?
China on Friday announced a flurry of other retaliatory measures in addition to the planned 34% tariff on U.S. goods.
The Commerce Ministry in Beijing said it would impose more export controls on rare earths, which are materials used in high-tech products like computer chips and electric vehicle batteries. And China’s customs administration said it had suspended imports of chicken from two U.S. suppliers, Mountaire Farms of Delaware and Coastal Processing.
China also filed a lawsuit with the World Trade Organization, saying the U.S. tariffs were “a typical unilateral bullying practice that endangers the stability of the global economic and trade order.”
Beijing also added 27 firms to lists of companies subject to trade sanctions or export controls.
The trade war between the U.S. and China isn't new. The two countries exchanged a series of tit-for-tat levies in recent months — on top of tariffs imposed during Trump's first term, many of which were preserved or added to under former President Joe Biden.
While China has taken the toughest approach so far, several countries signaled upcoming responses to Trump's “reciprocal” tariffs. The EU’s European Commission is among those that have vowed to fight back while promising to improve the free trade rulebook. Others may be hoping to negotiate for relief. Trump said Friday that he had a "very productive call" with Vietnamese leader To Lam and claimed the country wants to eliminate its tariffs on U.S. goods if it can make a deal.
Is the stock market continuing to fall?
Yes. Trump's trade actions have roiled financial markets worldwide in recent months, and they careened even lower on Friday.
Wall Street’s worst crisis since the COVID-19 crash deepened on Friday. Not even a better-than-expected U.S. jobs report, usually the economic highlight of each month, was enough to stop the slide. The S&P 500 tumbled 6% and the Dow Jones Industrial Average plunged 2,231 points, or 5.5%. The Nasdaq composite also dropped 5.8%
European stocks also saw some of the day’s biggest losses, with indexes sinking roughly 5%. The price of crude oil tumbled to its lowest level since 2021. Other basic building blocks for economic growth, such as copper, also saw prices slide on worries that the trade war will weaken the global economy.
What is Trump saying about all of this?
Trump has insisted he isn't changing his trade policies — describing them as a painful yet necessary step to encourage companies to relocate their operations to the U.S.
After stocks plunged on Thursday, he maintained that things are “going very well” and said both the markets and the country were “going to boom” from the tariffs.
Trump on Friday defended tariffs again on his social media platform Truth Social.
“IT’S ALREADY WORKING. HANG TOUGH, WE CAN’T LOSE!!!” he wrote.
Trump was swift to criticize Beijing’s move, claiming that China panicked and “PLAYED IT WRONG ... THE ONE THING THEY CANNOT AFFORD TO DO!”
Meanwhile, others continue to warn that the scale of Trump's tariffs could backfire. Federal Reserve Chair Jerome Powell said Friday that the tariffs were “significantly larger than expected” and are “highly likely” to cause more inflation — at least in the short term but possibly in the long term as well.
AP Business Writers Paul Wiseman in Washington, Elaine Kurtenbach in Bangkok and Stan Choe in New York contributed to this report.
© Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.
56 Comments
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Tamarama
What does Trump expect? Self respecting countries aren't going to just sit around and let the US try to bully them in trade. No way.
He's started a war, but what he will find is that the global collective will punish him, and the people of the US, fairly comprehensively. The US is going to get a real beat down.
This isn't making America great, this is making America stupid.
Underworld
Mike Johnson has the power to have Congress rescind the presidents right to levy tariffs.
starpunk
Has anybody even noticed who isn't getting a tariff slapped on them? Russia! Good doggie! Woof!
And by all these unwarranted tantrums against our NATO allies and Japan, you don't keep friends with such unwarranted uncouth behavior.
Oh yeah, trump is a Russian sputnik, and this may be one way to counteract the UN sanctions + embargo on his Moscow Masters. They've been hard on Russia because of their Ukraine war. They've even been buying (instead of building) robot drones from Iran. il Dirtbag sassed off Zel last week for standing his ground, so he has to stink his diapers and 'punish' everybody else for it all.
And Obey His Master. Putin.
Underworld
China's response isn't unreasonable. Trump didn't like it, but he must have known it would happen. Or did he think that they would be too scared to respond.
This is going to send inflation through the roof and trash the American economy. If they achieve stagflation, it will be years before it gets better.
Biden has a legacy of high job creation, record stock markets and eventually taming inflation. It's incredible the gullibility of the average US voter believed that Trump was gone to bring down prices. We warned them of the truth, but they didn't listen.
But this trade war will do nobody any good.
deanzaZZR
Russia is sanctioned up the yin yang. What would be the point.
JJE
No tariffs applied to Russia, Mexico or Canada as of this week.
Important not to offend your decent friends.
TaiwanIsNotChina
Trump will receive hell if sanctions come off scummy "friend" russia.
Haaa Nemui
Russia? Decent friend? Hahahahahahahahahaha
JJE
Senior Russian envoy Dmitriev is in Washington now. He is a Kiev born Goldman Sachs banker who understands investment (and the highest official to visit since 2022 - sanctions on him were waived). The negotiations are about US companies taking over EU holdings in Russia and working together.
This is a win-win situation for both economies. Amazing stuff.
TaiwanIsNotChina
We will believe it when we see it in the free press and not from the Kremlin.
JJE
Read it in then in that press. Kirill Dmitriev, born in the UkSSR, is in Washington at this moment in time. He is Putin's investment wizard.
Peter Neil
Canada and Mexico already have a 25% tariff on them.
What, $10 trillion gone on Wall Street in 3 days? Cool. All those public retirement funds and 401K’s take a hit. And to think Trump wants social security funds invested in the stock market…
This is unreal. Trump saying this is good news, everything is going great. Non-MAGA said Trump would be a crap show and it turned out he’s dumber than people thought. Trump world is a bad, dystopian dream.
The entire world has to spend time, energy and money going backward dealing with daily Trump nonsense instead of going forward. The worst president in history and the Republicans sitting on their hands, afraid to speak.
XCAndtheband
Of course Trump’s reactions is “You should have sit there and let me **** you!”
Stable genius right there, everyone. Trade wars are sooooo easy and we’re going to be soooo rich! Or wait…. it’s patriotic to pay more!! …what’s the line now?
MarkX
No further tariffs on Canada, but he has already levied them on the auto industry which will really hurt Canadians. As well as steel and aluminum which is also hurting Canada as a major supplier to the US.
wallace
Trump's Art of the Tariff Deal is in turmoil causing big falls in stock markets.
Peter Neil
He levied them on all goods, not just the ones you mentioned.
More concerning is the sudden buildup in Diego Garcia. Half of the U.S. B-2 fleet is there now. When the economies are bad and people angry, politicians go to war to make people rally around the flag.
wallace
Trump will increase sanctions on Russia if Putin does not agree to a peace deal.
According to the Office of the US Trade Representative, trade between the US and Russia was worth $3.5bn in 2024.
Bob Fosse
So all the maga crap he makes in China is going to be more expensive? Oh dear.
bass4funk
Yeah, sorry it’s not only Trump merch. Lol! Relax guy..
iron man
And meanwhile...International news reports, walmart (whoever them politicians are) is begging China suppliers to further reduce their prices to absorb Dumpsies tariffs. poor china 'slave labourers' EAT cabbage and work harder so walmart customers can continue to have cheap produce. Which came first...the cart or the horse??
lincolnman
"Markets fall"....says it all...
All our MAGA-fans getting what they voted for - deprivation, impoverishment, and poverty...
History will term this era the "MEM" - the MAGA-Economic-Meltdown....
Bob Fosse
Me too. They should put 100% tariffs on that crap and leave all the other stuff alone. Agreed.
Some dude
(To be read in the style of the Simpsons "Are we there yet?" gag)
Are we great yet?
(Repeat until Fox News says "yes")
Biggest two day market collapse ever observed, apparently.
Is there a tipping point at which "economic collapse" stops being profitable over "owning of libs"? I mean, obviously, for some of our friends on here, there is no such point, but one wonders if even the most hardcore Trump supporter can't see a link between these tariffs (on man and penguin alike) and the precipitous drop in the markets.
ulysses
I asked Chat GPT to calculate trade deficit with my FamilyMart and apparently it is 100%.
I am putting a 100% tariff on them and paid 252 yen for my 126 yen karage.
That will teach them!!!!
Pukey2
BRICS is the future. Trump and USA are about to find out how heavy that rock is when it hits that foot.
stormcrow
Like manna from heaven for China as MAGA continues its stupid economic course. As with DOGE, MAGA does everything with little to no foresight.
bass4funk
If you think so. Lol! Relax, don’t be angry.
Amber
Americans have to live with Trump's delusions. Other countries do not.
Peter Neil
Trump and MAGA can now take credit for the worst two-day drop in the stock market in history.
1/3 of the U.S. GDP gone in less than 3 months in office. Another record.
The U.S. is 9th in the world in GDP per capita, which tells you a lot about the wealth distribution. Largest economy in the world, but still no healthcare,
China will weather the tariffs better than the U.S. will.
Trump will cave. He has to, but the damage already done will linger for a long time. 2026 elections will be great reckoning.
ulysses
bass4funkToday 09:18 am JST
Indeed sir, I am so calm today, I will increase the tariffs to 200% today and start paying more and more.
Paying more is so Zen!!!!
rainyday
World economy is collapsing, everyone is about to become a lot poorer, JP Morgan now predicts recession this year.
But hey, at least I’m not seeing as many pronouns in people’s email signatures as I would be if that awful Kamala had won so its all worth it, amiright?
Bob Fosse
I kept hearing about how the ‘deep state’ controlled the economy. Seeing the markets crashing don’t you think they would stop this?
Does this mean the deep state aren’t real? Or, oh no, wait a minute. Is 47 working for them?
Newgirlintown
Incredibly naive, stupid and dangerous
lincolnman
Trump's tariffs and his budget bill are guaranteed to put all his supporters in the poor house...except for Elon and Vivek...
Two things stand out in this bill that shows the REAL Repub Party...
Yes, there it is - Repubs #1 priority - give themselves and their uber-rich donors a "huuuuge" tax cut...and screw the MAGA little guy by gutting his Social security and Medicare, and putting them into bankruptcy with inflationary tariffs...
Get that MAGA-fans? All that screaming you and Trump were doing about reducing the deficit? You just got played for a fool....Trump wants to blow it up by ANOTHER $5 TRILLION....
When will the light bulb come on that all the ranting about DEI, bathrooms, and Haitians eating pets is just sucker-bait and a distraction from Trump giving you the shaft...
Peter Neil
The BIG LIE about these tariffs is that they only include hard goods. The U.S. doesn't make much anymore. 80% of the U.S. economy is services.
The biggest US export is petroleum and petroleum products.
it's greater than the next 7 exported products combined.
lincolnman
Here's the first conservative economist that admits he got played for a sucker...
"CNBC host Jim Cramer said Thursday that although he doesn’t consider himself a “free trader” (he prefers the term “fair trader”), he still feels “like a sucker” after seeing the Trump administration’s massive tariffs.
https://www.yahoo.com/news/cnbc-jim-cramer-trump-tariffs-013936606.html
Who will be the next have the guts to admit they got played too?
lincolnman
Remember when JD Vance has these things to say about Trump - then FLIP-FLOPPED?
"Vance, who once flatly declared himself a “Never Trump guy” who “never liked” the New York Republican, has reportedly previously called Trump a "fraud," a "moral disaster," a "cynical a**hole," a "bad man," and suggested he could be "America's Hitler." He also once reportedly said Trump had "thoroughly failed to deliver his economic populism.”
Well, some of his views on tariffs share this same flip-floppery...
“So many of these jobs that have disappeared from these areas just aren’t coming back. They haven’t disappeared so much from globalization or from shipping them overseas,” Vance said in a January 2017 interview with Education Week. “They’ve largely disappeared because of automation and because of new technological change.”
“Can’t be repeated enough: if you’re worried about America’s economic interest, focus more on automation/education than trade protectionism,” Vance wrote."
As if he wasn't already a hypocrite and sell-out...
Peter Neil
My final comment in this topic, and I think the most important.
When you invert the situation, you see that the U.S. hard goods trade deficit would be less if the U.S. manufactured more quality products the world needs and wants.
The U.S. would rather play with and manipulate money instead. Your hands don’t get dirty.
patkim
You bully people, soon enough those that are bullied will fight back. I'm not surprised by the result. The rich and powerful in Trump's circle think they can make people capitulate to their every whim, like Russia does with Ukraine. Little do they know that people aren't going to just lie down and take it. They will fight.
TokyoLiving
Great move China..
Every stupid move US does, makes China stronger..
US has its economic war with Chine more than lost..
patkim
Trump always said he wanted to take America back to the time when the robber barons ruled. For some reason he has an obsession with the gilded age. I guess he doesn't realize it was that time in American history that helped to bring about the Great Depression. Seems like we're headed that way.
bass4funk
For not wanting to get ripped off? Yeah, delusional.
lincolnman
Gee, doesn't this give you confidence - Trump, his Commerce Secretary, and his Counselor - all contradicting each other...
"All within a few hours --
Howard Lutnick: “I don’t think there’s any chance Trump is going to back off his tariff"
Peter Navarro: “This is not a negotiation"
Donald Trump: "The tariffs give us great power to negotiate. They always have.”
As if we needed more evidence what a bunch of bumbling idiots these morons are...
This is who you voted for MAGA-fans - "The Club of Contradictory Clowns"...
kohakuebisu
Hilarious that this is hitting Bezos and the Apple CEO whose name I can't remember.
Or any other bigwig who paid to be at the inaugeration. It'll be costing them more than any tax cut they could hope Trump to give them.
wallace
What is America's trade and services deficit with the world?
Trump never includes services while 90% of the American GDP is services.
In 2024, the U.S. had a goods and services trade deficit of $918.4 billion, with a goods deficit of $1.21 trillion and a services surplus of $293.3 billion.
Mostly because America no longer manufactures all the goods it needs.
Americans bought large volumes of foreign machinery, pharmaceuticals, industrial supplies and car parts, according to new data released by the Commerce Department. The US last had a trade surplus in 1975.
lincolnman
My goodness....when senior-suck-up Ted Cruz, who loves Trump even though he dissed Cruz' wife and called her ugly, says he's "concerned" about Trump's tariffs, you know things are REALLY BAD in MAGA-world...
"Sen. Ted Cruz (R-Texas) took a rare step away from Donald Trump on Thursday when he became the latest Republican voice to question the president’s sweeping new tariffs, which have sent the stock market spiraling.
In an interview with Fox Business’ Larry Kudlow, Cruz said he opposed tariffs in general and cautioned of possible negative consequences for American consumers."
https://www.yahoo.com/news/ted-cruz-warns-donald-trump-070623603.html
Erik
For not wanting to get ripped off? Yeah, delusional.
I heard the penguins of Heard and McDonald Islands have agreed to stop ripping off the United States. Another win.
bass4funk
Well, thankfully a lot of that is going to change, incentives help.
rainyday
The fact that the US is by far the richest country in the world, yet people like you are willing to completely destroy the system that made it so because you buy the idiotic lie that you are being “ripped off” for no other reason than the fact that your country is so rich that it buys more stuff from the rest of the world than the rest of the world buys from it is why the US is about to go down the toilet.
Good riddance.
Underworld
bass4funk
Americans bought large volumes of foreign machinery, pharmaceuticals, industrial supplies and car parts, according to new data released by the Commerce Department. The US last had a trade surplus in 1975.
It's unlikely to change. The US will always buy more than they sell. And the thing is, that's fine. It doesn't mean that the US is being ripped off.
patkim
These Trump tariffs don't make sense at all. Why does Trump place serious tariffs on countries like Madagascar where 75% of the worlds vanilla come from? It's not like America or other countries can easily make these kinds of products. Why doesn't Trump tax/tariff countries like Russia and Belarus more?
patkim
The problem is this. During the Great Depression, people had to worry about so many things; disease, poverty, lack of food, war. Then, Americans were able to live in a nice time of great prosperity. Now, we are drifting to a place where we have to worry about losing our jobs, affording the price of food, the safety of our nation, compromised security, and a looming depression. The right worked so hard to make people believe that LGBTQ rights was was the worst thing to worry about in our lives. Now, Trump has created much more serious issues for us to worry about.
patkim
Trump is placing tariffs on things that America doesn't even make. The high tariffs on Lesotho is ridiculous because American companies are not even interested in investing in such a poor country. The deficit is only high because greedy Americans import so many diamonds from there. That's it. Trade is not a simple thing that can be calculated, but Trump has this belief that the trade deficit can be calculated simply by concentrating on the goods, while disregarding the services that is traded, and doesn't even consider the political and economic climate in such areas.
Pukey2
Somebody get me more popcorn. Lovin' watching this circus freak show called USA.
patkim
This is how severe the disconnect is. Here is Trump right now playing a round of golf, subsidized by the wealthy Saudis, and Trump is probably at Mar la Mago having a nice dinner. Meanwhile, he's asking, no, demanding Americans to change their spending habits to meet the effects of his tariffs. While he is enjoying the good life, the regular American now is looking at their 401k and fearing for their future. Americans worrying how they will afford their retirement and even just their basic day to day needs.
wscheuerpflug
The kingdom of Lesoto as the biggest global thread for the US trade balance? With all respect for Lesoto, the old man in the White House really is the greatest apprentice of world economics!