Tariffs live: China hits back against Trump with 84% duty on US goods coming into force

China has hit back against the US in the escalating trade war between the world’s two largest economies, bringing into force 84 per cent tariffs on all US imports from today.

That came just hours after Donald Trump paused almost all his “reciprocal” tariffs programme but raised duties on Chinese imports to 125 per cent, calling it a punishment for Beijing’s retaliation.

The US president earlier said a resolution with China was possible, while his officials said they will prioritise talks with other countries.

“China wants to make a deal,” Mr Trump said, adding: “They just don’t know how quite to go about it.”

Treasury secretary Scott Bessent said that the negotiations between the US and individual countries would be “bespoke”, meaning that the next 90 days would involve talks on a flurry of potential deals.

Markets bounced back this morning after US president Donald Trump yesterday announced a 90-day pause on his sweeping “reciprocal” tariffs.

Mr Bessent, a former hedge fund manager, told reporters that the pause was because of other countries seeking talks rather than brutal selloffs in the financial markets.

“The only certainty we can provide is that the US is going to negotiate in good faith, and we assume that our allies will too,” Mr Bessent said.

The treasury secretary said he and Mr Trump “had a long talk on Sunday, and this was his strategy all along” and that the president had “goaded China into a bad position.”

Chinese commerce minister Wang Wentao held meetings wth representatives of the EU and the chair of Asean nations over Donald Trump’s “reciprocal” tariffs.

The trio shared “a candid exchange of views on strengthening bilateral economic and trade cooperation and responding to the so-called reciprocal tariffs imposed by the US”, China said in a statement today.

China and the EU this week agree to promptly initiate consultations to thoroughly discuss market access-related issues, create a more favorable business environment for enterprises, and immediately commence negotiations on price commitments for EVs, as well as explore investment cooperation in the China-EU automotive industry, the Chinese ministry said.

The Japanese government today said it received “positively” US Donald Trump’s pause on new tariffs but “strongly” demands Washington reconsider tariffs.

“We received the latest US announcement positively,” chief government spokesman Yoshimasa Hayashi said, adding: “We continue to strongly demand that the United States reviews measures on its reciprocal tariffs, tariffs on steel and aluminium, and tariffs on vehicles and auto parts.”

Japan, one of America’s strongest allies, was hit by 24 per cent duty last week. Japanese prime minister Shigeru Ishiba said he told Mr Trump during a phone call that his tariff policies were extremely disappointing and urged him to rethink.

Mr Trump said Japan is sending a team to the US to negotiate on trade.

Mr Trump said he was pausing almost all of his so-called “custom” tariff regime, but “baseline” tariffs of 10 per cent remained unaffected by the pause.

China let its yuan fall to its weakest level since December 2007 at 7.3518 per dollar after US president Donald Trump raised the tariff on Chinese imports to 125 per cent.

Prior to market opening, the People’s Bank of China set the midpoint rate, around which the yuan is allowed to trade in a 2 per cent band.

A weaker yuan would make exports cheaper and alleviate some pressure on China’s trade and the broader economy, albeit with risks of unwanted capital outflow.

However, Chinese equity markets opened on a strong note, with CSI300 blue-chip index rising 1.6 per cent, while Hong Kong’s Hang Seng Index jumped 3.3 per cent.

The founder of the world’s largest hedge fund has called for a US deal with the Chinese on tariffs and said that the next goal for president Donald Trump’s administration should be to cut the country’s deficit to 3 per cent of GDP.

“Trump’s decision to step back from a worse way and negotiate how to deal with these imbalances is a much better way,” Ray Dalio, who helms hedge fund Bridgewater Associates, said in a post on X.

Asian stock markets are bouncing back today after US president Donald Trump paused most of his plan for sweeping “reciprocal” tariffs.

• Japan’s Nikkei 225 index surged almost 9 per cent during the opening trade, while the broader Topix index rose 7.44 per cent.

• South Korea’s Kospi index surged 5.36 per cent as the small-cap Kosdaq gained 5.32 per cent.

• China’s CSI 300 rose 1.60 per cent, while Hong Kong’s Hang Seng Index jumped 3.92 per cent.

Donald Trump changed course again on Wednesday and announced a 90-day pause of his so-called “reciprocal” tariffs while hiking other duties on China to 125 percent.

The US president’s decision followed several days of sharp losses on the stock market. In a Truth Social post, Trump claimed that his reversal was a result of what White House officials have claimed are dozens of foreign nations reaching out with the intention of re-negotiating trade policy with the United States, rather than implementing tariffs of their own.

He said on Wednesday afternoon that his decision was made in response to days of market panic and rippling effects across various economic sectors, which Trump and other White House officials spend days unsuccessfully trying to quell.

“I thought that people were jumping a little bit out of line. They were getting yippy, you know, they were getting a little bit yippy, a little bit afraid,” Mr Trump told reporters at a White House event with NASCAR drivers on Wednesday afternoon. “I’ve reversed it. It’s for a short period of time.”

John Bowden and Andrew Feinberg have the full report, from Washington DC: