Summary

US President Donald Trump is ramping up the pressure in his ongoing trade war with China.

The US administration has slapped a new 10 percent duty on about $200 billion worth of Chinese imports. The new tariffs will come into effect next week and are scheduled to increase to 25% at the beginning of 2019, unless of course a deal is reached by then.

The new announcement comes in addition to the $50 billion of tariffs already being applied to Chinese imports, including steel, aluminum, vehicles, and various high-technology inputs.

China is expected to retaliate, with scheduled trade talks in Washington DC being a likely first casualty of the new escalation. Yet given that Beijing has already slapped duties on most US exports, the Chinese leadership will be forced to get creative this time in its efforts to punish the Trump administration.