WASHINGTON. U.S. President Donald Trump has intensified the ongoing global trade war by threatening to impose even steeper tariffs on Chinese imports, sparking a third consecutive day of turmoil in global financial markets and raising recession fears among investors.
Speaking from the White House, Trump defended his sweeping tariff policy which includes a minimum 10% duty on all U.S. imports and targeted rates of up to 50% as necessary to rebuild America’s weakened industrial base.
“It’s the only chance our country will have to reset the table. Because no other president would be willing to do what I’m doing, or to even go through it,” Trump told reporters. “Now, I don’t mind going through it because I see a beautiful picture at the end.”
Hours earlier, Trump warned that he would slap an additional 50% tariff on Chinese imports starting Wednesday unless Beijing rolls back the 34% retaliatory duties it imposed on American goods last week. Those tariffs were in response to Trump’s own 34% “reciprocal” duties.
China quickly rebuked the threat. In a statement, Chinese embassy spokesperson Liu Pengyu called it a “typical move of unilateralism, protectionism and economic bullying.”
“We have stressed more than once that pressuring or threatening China is not a right way to engage with us,” Liu added. “China will firmly safeguard its legitimate rights and interests.”
European Union Joins the Fray
As tensions between Washington and Beijing escalated, the European Commission proposed a 25% counter-tariff on a range of U.S. goods, including soybeans, nuts, and sausages — in retaliation to existing U.S. tariffs on EU metals and autos. A draft list by Reuters showed that certain items like bourbon whiskey were excluded for now.
Despite the growing hostilities, EU Trade Commissioner Maros Sefcovic signaled openness to dialogue:
“Sooner or later, we will sit at the negotiation table with the U.S. and find a mutually acceptable compromise,” Sefcovic said during a press conference, proposing a potential “zero for zero” deal with Washington.
Financial Markets React
The threats of escalating tariffs sent global markets reeling. The S&P 500 closed lower after a volatile session that pushed it to its lowest point in over a year. In Asia, mainland China and Hong Kong stocks plunged, prompting China’s sovereign wealth fund to step in to stabilize the market. Taiwan’s stock index fell nearly 10%, marking its steepest one-day decline in history.
Wall Street executives voiced their alarm. JPMorgan Chase CEO Jamie Dimon warned of the long-term negative consequences, while hedge fund manager Bill Ackman described the tariff threat as an “economic nuclear winter.”
Even some Trump allies questioned the approach. Elon Musk, a key supporter of government spending cuts, urged for zero tariffs between the U.S. and Europe over the weekend. In response, Trump’s trade adviser, Peter Navarro, dismissed Musk as merely a “car assembler.”
White House Doubles Down
Despite the mounting backlash, Trump’s economic team remained resolute. White House economist Kevin Hassett told Fox News:
“He’s doubling down on something that he knows works, and he’s going to continue to do that. But he is also going to listen to our trading partners, and if they come to us with really great deals that advantage American manufacturing and American farmers, I’m sure he’ll listen.”
Trump also confirmed that his administration would launch trade talks with Japan, a close U.S. ally, while dozens of other countries have reportedly reached out in hopes of being spared from the steep new tariffs due to begin on Wednesday.
As global markets brace for more volatility, the world watches closely to see whether Trump’s high-stakes economic gamble will yield leverage at the negotiating table — or plunge the global economy deeper into uncertainty.
