China wasted no time in responding to the latest U.S. trade measures, imposing tariffs on a wide range of American imports just minutes after new U.S. levies took effect.
At exactly 12:01 a.m. ET (05:01 GMT) on Tuesday, a 10% tariff on all Chinese imports into the U.S. came into force, as previously announced by President Donald Trump. In a rapid countermeasure, China’s Ministry of Finance unveiled fresh tariffs on key U.S. exports, intensifying tensions between the world’s two largest economies.
China Targets U.S. Energy and Auto Sectors With New Tariffs
China’s retaliatory measures include:
- 15% tariff on coal and liquefied natural gas (LNG)
- 10% tariff on crude oil, farm equipment, and select automobiles
These new tariffs are set to take effect on February 10, further disrupting U.S. exports to China.
In addition to these direct trade measures, China has introduced export controls on critical minerals, including tungsten, tellurium, ruthenium, and molybdenum. The Commerce Ministry and the Customs Administration justified these restrictions as necessary to “safeguard national security interests,” signaling a broader strategy to curb the U.S.’s access to essential industrial materials.
China Expands Retaliation Beyond Tariffs
While President Trump opted to suspend a planned 25% tariff on Mexico and Canada after securing border enforcement concessions, China was granted no such reprieve. A White House spokesperson confirmed that Trump had no immediate plans to speak with Chinese President Xi Jinping, though a discussion could take place later in the week.
In a further escalation, China added two major U.S. corporations to its Unreliable Entity List:
- PVH Group, parent company of Tommy Hilfiger and Calvin Klein
- Illumina Inc., a biotech firm specializing in genomic sequencing
According to China’s Commerce Ministry, these firms allegedly violated market principles and engaged in discriminatory practices against Chinese businesses. Companies placed on this list face potential fines, trade restrictions, and investment limitations within China—posing significant risks for their global operations.
Adding another layer to the trade dispute, China has launched an antitrust investigation into Google. Announced just after the U.S. tariffs took effect, this move indicates Beijing’s willingness to use regulatory scrutiny as a retaliatory tool against American corporations.
Trade War Intensifies: Global Markets Brace for Impact
With both nations implementing aggressive trade measures, the latest developments mark a critical turning point in the U.S.-China trade war. Analysts warn that continued escalation could have far-reaching consequences on global markets, affecting everything from commodity prices to supply chain stability.
Financial markets reacted swiftly, with risk assets—including cryptocurrencies—experiencing heightened volatility in response to the uncertainty.
Crypto Markets Rebound After U.S. Pauses Tariffs on Mexico
While tensions with China escalated, the cryptocurrency market found relief after the U.S. temporarily suspended planned tariffs on Mexico and Canada. This decision helped ease investor anxiety over a broader trade conflict, leading to a sharp recovery in digital assets.
- Bitcoin (BTC) surged past $102,500, rebounding strongly after earlier declines.
- Ethereum (ETH) climbed to $2,900, signaling renewed investor confidence.
- XRP rallied 40%, erasing previous losses, while Solana (SOL) gained 5% to trade at $210.
Analysts noted that while cryptocurrencies remain highly sensitive to macroeconomic developments, the delay in Mexican tariffs improved market sentiment and restored speculative interest in digital assets.
As geopolitical and trade tensions continue to evolve, investors remain cautious, watching for further developments that could impact financial markets—including the ever-volatile crypto sector.