In yet another bit of incrementally disconcerting trade news, Donald Trump wanted to double existing tariffs on China last month after Beijing retaliated to the duties announced on August 1.
In the days leading up to China's August 23 decision to hit $75 billion in US goods with tariffs, Trump indicated he did not expect Beijing to hit back after his latest broadside. That assumption proved to be misguided. It's not clear why Trump believed China would sit on its hands. After all, the tariffs announced on August 1 represented a flagrant slap in the face to President Xi, who had agreed to deescalate the situation barely a month earlier in Osaka.
Trump was furious after the retaliatory measures were announced and according to three sources who spoke to CNBC, "his reaction, communicated to aides on a White House trade call held that day, was to suggest doubling existing tariffs".
Initially, the president took his frustration out on the Fed in a series of bombastic tweets which sent stocks tumbling to one of their worst days of the year.
Had Trump doubled all existing tariffs, it would have meant duties on the $250 billion in goods taxed at 25% would have jumped to 50%.
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