The Chinese Commerce Ministry has indicated its readiness to introduce various import tariffs on 5,207 US goods worth approximately $60 billion.
The Commerce Ministry said in a statement that the tariffs would be imposed at four different tax rates.
China’s announcement comes after President Donald Trump threatened to raise the proposed tariff rate on an additional $200 billion worth of goods to 25% from 10%.
Just minutes after China appeared to offer Trump an olive branch in the trade wars, when as we reported moments ago it nuked Yuan shorts by hiking forward FX reserve requirements by 20% in the process effectively easing financial conditions in the US by sending the dollar sharply lower (and the Yuan higher), China surprised the market which took the PBOC announcement as a “risk on” signal, by releasing the proposed retaliation list to US tariffs, and announcing it will impose differentiated tariffs on $60 billion in US goods.
China says that the import tax rates will range from 5%, 10% and even as high as 25%, and will be implemented as soon as the US enacts its own tariffs. Furthermore, the Chinese Government said it reserves the right for additional retaliation measures
According to the announcement, the measures are to guard its interest and to keep trade frictions from escalating, although the moment Trump sees that China is responding in kind, he will most likely flip out and demand that the next set of $200BN in tariffs be swiftly implemented.
On the news, futures which spiked earlier on the FX reserve requirement increase, have slumped back to almost unchanged, with China effectively negating the risk on effect from its currency intervention.