US Announced New Tariffs on Chinese Goods

In a surprising turn of events, President Trump announces new tariffs on Chinese goods starting September 1st.  In true Trump fashion, the news comes in a tweet.  Earlier today, Trump talked about the trade talks between the US and China.  While negotiations are still ongoing, the United States will impose a 10% tariff on about $300 billion of goods, on top of the current 25% on other tariffs. 

In June during the last meeting with China, Trump had promised to not impose any additional tariffs on China.  However, this promise was based on promises by China that did not come to fruition.  The tariffs on new Chinese goods include toys, clothing, and even technology goods like the iPhone. 

These new tariffs will be felt by consumers through their pocketbooks.  As previously mentioned, retail has been growing steadily.  These new tariffs could affect that.  Retail groups believe this new tariff will raise the cost of goods, which will be passed onto consumers. 

Following the news, the stock dropped again.  Dow fell over 300 points, similar to that of yesterday after the rate cut from the Federal Reserve.  Trump is confident that the US and China will be able to come to terms with their trade talks, which are expected to continue.  China is sure to retaliate, as they have done before.  The US manufacturing industry and many analysts were hoping for a reprieve later this year, when many believed the negotiations were due to continue and hopefully come to an end.

These additional tariffs do not bode well for the national economy, nor China’s.  This feeds directly into the uncertainty the Chairman of the Federal Reserve spoke of.    There are no winners in a trade war, and most certainly not the US.