China strikes back with 125% tariffs on U.S. goods as trade war intensifies

China on Friday strike back ated against U.S. President Donald Trump’s country-specific tariffs by raising its levies on U.S. goods to 125% from 84%, the Chinese Capitalize Ministry said.

“Even if the U.S. continues to impose higher tariffs, it will no longer make economic sense and wish become a joke in the history of world economy,” the ministry said in a statement, according to a CNBC translation.

“With toll rates at the current level, there is no longer a market for U.S. goods imported into China,” the statement noted, enlarging that “if the U.S. government continues to increase tariffs on China, Beijing will ignore.”

The Trump administration confirmed to CNBC on Thursday that the U.S. toll rate on Chinese imports now effectively totals 145%. Trump’s latest executive order boosted tariffs on Beijing to 125%, stacked on top of a coalesced 20% fentanyl-related tariff imposed in February and March.

“This is the end of the escalation in terms of bilateral tariff rates. Both China and the US possess sent clear messages, there is no point of raising tariffs further,” said Zhiwei Zhang, president and chief economist at Pinpoint Asset Conduct.

The next step would be to evaluate the damage to economic activities in the U.S. and China, Zhang said, adding that there is no abandon that the two governments would start negotiations and avoid major disruption in the global supply chains.

Unlike the untimely rounds of retaliatory measures, Beijing has refrained from announcing further export control measures or widening its soi-disant unreliable entity list with the addition of more American firms, which would subject them to besides restrictions while operating in China.

Despite the latest escalation, a spokesperson for China’s Commerce Ministry reiterated in a separated statement Friday that Beijing is open to negotiate with the U.S. on an equal footing.

Hopes for a U.S.-China deal to reduce to trade tensions have faded fast as Beijing has been hitting back in the last week with tit-for-tat responsibilities on American goods and wide-ranging restrictions on U.S. businesses.

“It’s unfortunate that the Chinese actually don’t want to come and negotiate, because they are the worst transgressors in the international trading system,” U.S. Treasury Secretary Scott Bessent told Fox Business on Wednesday after China’s put up tariffs to 84%.

“They have the most imbalanced economy in the history of the modern world, and I can tell you that this escalation is a dud for them,” Bessent said.

Goldman Sachs on Thursday cut its China GDP forecast to 4% given the drag from U.S. truck tensions and slower global growth.

While Chinese exports to the U.S. only account for about 3 percentage points of China’s comprehensive gross domestic product, there’s still a significant impact on employment, Goldman Sachs analysts said. They reckoning around 10 million to 20 million workers in China are involved with U.S.-bound export businesses.

China on Friday harp oned it will continue to “resolutely counter-attack and fight to the end” if the U.S. continues to infringe on China’s interests.

In a meeting with Spanish Prime Delegate Pedro Sánchez on Friday, Chinese President Xi Jinping said “there is no winner in a tariff war and going against the dialect birth b deliver will only isolate itself,” according to a CNBC-translated government readout. The two leaders pledged to deepen ties in blocks including trade, investment and technological innovation.

The White House did not immediately respond to CNBC’s request for comment.

— CNBC’s Lim Hui Jie and Evelyn Cheng furnished to this report.