The US and China are deep in a trade Cold War, with both nations escalating import tariffs in a tit-for-tat battle. Just yesterday, Trump imposed a 104% tariff on all goods exported from the U.S. to China. Now, that figure has been bumped up to 125% in response to China’s retaliatory move.
In a recent Truth Social post, the President-elect stated, “Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately.”
He further added, “I have authorized a 90-day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter.” This effectively places a temporary pause on tariffs for countries that haven’t retaliated against the recent U.S. tariff hikes.
Following the announcement, the S&P jumped by 9.5%, according to the New York Times. In the same post, White House Press Secretary Karoline Leavitt confirmed that tariffs will be reduced to 10% across the board excluding China. The lower rate will especially apply to nations that export significant volumes of goods to the U.S., such as Vietnam.
However, this still spells trouble for the consumer electronics sector, as the majority of these products are imported from China. With the new tariffs more than doubling import costs, the prices of many devices are set to soar. Some of the impact is already visible Nintendo has delayed pre-orders for the Switch 2, while Razer and Framework have paused shipments. If the U.S. and China don’t reach a diplomatic resolution soon, the consequences for the tech industry could be severe.
