145% Tariffs and a Global Showdown: China Rejects US “Arrogance”

The U.S.-China trade war has officially reached uncharted territory. Less than 24 hours after China hit U.S. goods with an 84% retaliatory tariff, President Trump fired back with a new executive order—raising total U.S. tariffs on China to a staggering 145%.

“Based on the lack of respect that China has shown to the World’s Markets… the days of ripping off the U.S.A. are over,” Trump said on Truth Social, moments before the order took effect.

Included in the new tariff slate:

🔺 125% reciprocal tariff on all Chinese imports
🔺 20% special levy targeting fentanyl-linked pharmaceutical precursors

China Fires Back — In Words (For Now)

China’s Foreign Ministry responded with fury:

“We will never accept arrogant and bullying behavior,” the ministry said in a strongly worded statement released Thursday morning.

Beijing’s tone has shifted from strategic patience to direct confrontation. Analysts now expect further escalations in the coming days—potentially including rare earth export bans, increased pressure on American firms operating in China, or retaliatory measures in the tech and energy sectors.

Xi’s Allies: “Do Nothing. Win.” No More

Chinese strategists had previously urged a posture of calm in the face of Trump’s trade belligerence, with the now-famous phrase circulating in elite WeChat groups:

“Do nothing. Win.”

But sources inside the Chinese government tell The Guardian and CCTV that the tone has changed.

“We were prepared. We have the leverage. This time, we respond,” one senior official said anonymously.

Markets and Diplomacy: Collateral Damage Mounts

While markets rallied yesterday on news of a 90-day pause for non-retaliating allies, today’s tariff hike on China put U.S. recession fears back in the headlines.

S&P 500: +0.3% (muted gain after yesterday’s 7.4% rally)
Yuan: Falls to 7.92 against the dollar
Crude oil: Down 2.1% as traders brace for a demand shock

Diplomatically, Trump’s latest move risks splintering the G7 trade coalition, with EU leaders warning of retaliatory ripple effects and Beijing strengthening ties with Brazil, Indonesia, and the Middle East.

Inside the White House: “Trump Isn’t Bluffing”

White House Press Secretary Karoline Leavitt confirmed the 145% tariff figure today, stating:

“It was a mistake for China to retaliate… The president, when America is punched, he punches back harder.”

Treasury Secretary Scott Bessent added:

“This is how we win. Trump is building new leverage in real-time.”

What’s Next?

China is expected to announce further countermeasures by Friday
Trump has floated a potential 150% threshold if “China continues to disrespect America”
U.S.-China trade volume could collapse by 50% or more, according to JP Morgan