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China Retaliates with Major Tariff Hike

China Retaliates with Major Tariff Hike”

A series of tweets by Donald Trump playing up the chances of a trade deal with China provided a much-needed boost to Asian equities yesterday but investors trod cautiously as analysts warned of more volatility to come.

"We have a dialogue going".

"Strength is the only way to win with China", Schumer said.

And although he said he has an "extraordinary" relationship with Chinese leader Xi Jinping, Trump insisted he will not sign onto any deal unless it is a good one.

"We had a deal that was very close and then they broke it". In fact, America's biggest economic problem is that we have more job openings than unemployed people to fill them.

"We're having a little squabble with China because we've been treated very unfairly for many, many decades", Trump said, referring to USA complaints about Chinese intellectual property and subsidy practices.

Trump believes that he will be victorious and his tariffs on Chinese goods, which he raised to 25 percent last Friday, are putting the squeeze on Beijing, he's signaled publicly and to his allies.

But shares in Europe rebounded and the future contracts for the Dow Jones Industrial Average and S&P 500 were up 0.5 percent and 0.6 percent, respectively. The U.S. president claims the Chinese backed out after they assessed they could get a better deal in another administration.

Chinese authorities were reacting to President Donald Trump's surprise decision last week to impose punitive duties on $200 billion of imports from China.

And both see the honour of their nation at stake at a crucial moment in the history of US-China relations, as the emerging competition between two great powers becomes sharper than ever.

Benchmarks in London, Shanghai and Tokyo advanced as investors tried to figure out the costs of US and Chinese tariff hikes on hundreds of billions of dollars of each other's goods. Farmers are also suffering from extensive flooding that has delayed planting.

"The trade war is driving markets at the moment", said Rory McPherson, head of investment strategy at Psigma Investment Management in London.

All of that is very harmful to the entire United States economy", he said on "Cavuto: "Coast-to-Coast" Tuesday.

Benchmark U.S. 10-year Treasury notes last fell 3/32 in price to yield 2.4139%, from 2.405% late on Monday. Soybean exports to China collapsed previous year when the trade war began, and agricultural exports will be hit harder when, or if, the new tariffs are imposed.

Also Tuesday, China's tightly controlled social media were filled with comments lambasting Washington following weeks of little online discussion of the dispute.

Trump is trying to smoke the Chinese out after a deal he says was almost finished fell apart last week.

CHINA ECONOMY: China's April factory output and consumer spending weakened as a tariff war with Washington intensified.

The Shanghai Composite Index lost 0.7% and the blue chip CSI 300 was 0.6% lower on Tuesday.

While the United States has added about half a million manufacturing jobs since Trump took office, China's manufacturing sector is shedding jobs. "If someone brings the war to us we will fight it until we win", Geng Shuang told reporters at a daily briefing. The two sides held seven rounds of talks addressing a wide range of issues including technology transfers, intellectual property protection, non-tariff barriers, agriculture, services, currency, purchasing and enforcement mechanism.



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