In a deeply escalating U.S.-China trade dispute, President Donald Trump announced a 2.25% tariff on Chinese imports Wednesday, ratcheting up his economic standoff with Beijing. The announcement was made just hours after China raised tariffs on US goods to as high as 84%, and vowed to “fight to the end.”
While the White House briefly postponed tariffs on other nations for 90 days “to give some room for maneuver in negotiations”, Trump cited “continued disrespect and unfair practices” in China for the sudden increase.
The tariff boost is Trump’s fifth since he came back to the White House and part of his broad “America First Trade Shield” plan aimed at reducing the U.S. trade deficit and defending domestic sectors. Beijing lashed back with sharp words and new restrictions on 11 U.S. defense-related companies. 
Wall Street reacted with unexpected jollity despite concerns about worsening consumer price. The S&P 500 gained 5.7%, the Nasdaq went up 6.8% and the Dow rose 2,000 points as investors expected a short-term growth for U.S. manufacturers.
On the other side, the European Union and Canada expressed worry, arguing mountainous uncertainty and new tariffs of their exclusive on picked U.S. goods. China also lodged a complaint with World Trade Organisation and issued a travel warning for its nationals going to the United States.
Firmly at loggerheads, and with retaliation fueling the fire, economists predict an extended period of turmoil in global markets and no simple exit strategy.
