Trade tensions between China and the U.S continued to increase. China on Wednesday announced a new proposed tariff that are designed to target up to $50 billion of 106 U.S. products annually.
According to the announcement, China would impose 25 percent tariffs on U.S. goods, including soybeans, cars and some airplanes.
China’s latest move came after just hours after the Trump administration announced to impose a 25 percent tariff on Chinese products that used for robotics, information technology, communication technology and aerospace.
“The assumption was China would not respond too aggressively and avoid escalating tensions. China’s response is a surprise for some people,” said Julian Evans-Pritchard, senior China economist at Capital Economics, according to CNBC, “It’s more of a game of brinkmanship, making it clear what the cost would be, in the hopes that both sides can come to agreement and none of these tariffs will come into force,”
U.S. stocks were traded lower on Tuesday after the increasing trade tensions. The Dow Jones industrial average fell 240 points during Tuesday trading session.
U.S. President Donald Trump wrote in a post on Twitter on Wednesday: “We are not in a trade war with China, that war was lost many years ago by the foolish, or incompetent, people who represented the U.S.”