China on Friday announced new tariffs on U.S. products... Sending Wall Street into a tailspin... And causing President Donald Trump to erupt in anger... All signals that the trade turmoil is far from over.
Reuters trade correspondent Andrea Shalal: SOUNDBITE (ENGLISH): REUTERS TRADE CORRESPONDENT ANDREA SHALAL, SAYING: In another dramatic development on Friday President Trump has now increased the tariffs on two sets of Chinese imports, one already in effect that's $250 billion worth of Chinese goods and additional tariffs that go into effect September 1st and December 15th.
Both go up by 5 percent.
One rate goes from 25 to 30 percent.
The more sensitive goods which will potentially really effect consumers; laptops, toys, clothing - those go up fro m10 percent to 15 percent.
This latest flare up started when Beijing announced tariffs on $75 billion worth of U.S. goods, which prompted a Twitter tirade from Trump, who wrote: "Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing....your companies HOME and making your products in the USA." The Dow plunged more than 600 points by the closing bell led by Apple, Intel, and Nike - all companies with either major operations within or sales to China.
Oil prices tumbled as well and so did prices for soybeans, a major U.S. export to China.
The drops followed China's plan to slap import taxes of between five and ten percent on over 5,000 American products including grains and crude oil.
That decision is in retaliation to a Trump threat last month to raise tariffs on $300 billion of Chinese goods, including consumer electronics.
The tit-for-tat escalation in an ongoing trade war ratcheted up Wall Street fear that without a resolution the trade impasse could further slowdown the global economy and eventually erode U.S. economic growth.
Federal Reserve Chairman Jerome Powell warned on Friday - if that happens the Fed won't have the tools to fix that.