October 10 2025
By Cat Zakrzewski, Cate Cadell, Dan Diamond, and Eva Dou
President Donald Trump on Friday said he would impose a new 100 percent tariff on goods from China, escalating tensions with Beijing after Chinese leader Xi Jinping issued new export restrictions that upended months of trade negotiations between the world’s two largest economies.
Trump announced the levy shortly after the markets closed — and after stocks sank on his earlier threats to increase tariffs and cancel a meeting later this month with Xi. The Dow Jones Industrial Average was down almost 900 points, and the S&P 500 sank 2.7 percent in the biggest one-day drop since April.
The new tariffs will take effect Nov. 1 “or sooner, depending on any further actions or changes taken by China,” he wrote on his Truth Social platform. Average tariffs on imports from China stand at about 57 percent, according to the Peterson Institute for International Economics, after hitting a high of 140 percent at the peak of Trump’s trade war earlier this year.
Trump also wrote that he would impose export controls on “any and all critical software” as he retaliated against China’s new restrictions on rare earth minerals that are essential to the U.S. economy. The announcement could set back a U.S.-China trade deal that businesses and investors have hoped would stabilize one of the world’s most consequential foreign policy relationships.
“Dependent on what China says about the hostile ‘order’ that they have just put out, I will be forced, as President of the United States of America, to financially counter their move,” Trump wrote in a separate post Friday morning. Trump also said that there “seems to be no reason” to go forward with a planned meeting with Xi at the Asia-Pacific Economic Cooperation (APEC) forum in about two weeks.
Trump retaliated as he accused China of attempting to “clog” global markets with sweeping new rare earth export controls that would stifle global access to critical raw materials required for computer chips, medical equipment, defense technology and other products. Beijing has wielded its influence over the rare earth supply chain as leverage over the United States amid ongoing trade talks.
The controls are likely to have a major impact throughout the global economy, disrupting the supply chains for the data centers and computers needed to train new artificial intelligence models. U.S. officials have been seeking alternatives to reduce the nation’s dependence on Chinese materials, but many companies are still reliant on China for their supply. Beijing overnight also announced an antitrust probe into U.S. mobile chip giant Qualcomm, weeks after launching another into U.S. AI chip champion Nvidia.
The moves sent shock waves among investors, as an index known as Wall Street’s “fear gauge” rose 30 percent, reaching its highest level since May. Companies have scrambled to respond to Trump’s frequently changing tariff regime, as the president has often changed the levies following retaliatory moves from China and instability in the U.S. markets.
The Trump administration and Chinese leaders have spent months wrangling over Trump’s plan to impose high tariffs on China, with both countries trading economic threats in their trade showdown.
The White House declined to clarify Trump’s plans to impose tariffs or say whether he will meet with Xi. The Chinese Embassy did not immediately respond to requests for comment.
Beijing and Washington have in recent months sought to build consensus on trade even as leaders engaged in a tit-for-tat tariff race. The leaders have held two official phone calls and marked a diplomatic win in September with an agreement to transfer TikTok’s U.S. operations to American investors, which had been a major sticking point in relations. That détente set the stage for a potential meeting this month at the APEC summit in South Korea, a step widely seen as paving the way for a potential Trump visit to Beijing next year.
“There was a tacit understanding that a pause in escalation worked for both sides,” Ryan Hass, director of the John L. Thornton China Center and the Chen-Fu and Cecilia Yen Koo chair in Taiwan studies at Brookings, wrote on X. “It gave them both time and space to build greater self-reliance. Trump’s strong reaction to China’s new export controls suggests that he felt like Beijing broke that tacit understanding.”
The White House’s threats have jeopardized plans for the leaders to meet, even beyond this month’s APEC forum. Such high-level meetings between the two countries’ leaders and military officials are often subject to last-minute derailment, given the sensitivity of the relationship. In February 2023, when a suspected Chinese spy balloon was detected over the United States, a planned high-level visit by senior U.S. officials to Beijing was abruptly canceled as both sides navigated the fallout. Similarly, when then-House Speaker Nancy Pelosi (D-California) visited Taiwan in August 2022, Beijing immediately cut off military communication lines with Washington.
The deterioration in U.S.-China relations also injects uncertainty into the TikTok deal that Trump had announced with fanfare last month, as Beijing still needs to give final regulatory approval to allow ByteDance to sell TikTok’s U.S. business to U.S. buyers.
Over the past six months, the two countries have wielded their power with nontariff measures, export controls, agricultural boycotts and antitrust investigations.
The Trump administration last month expanded the Commerce Department’s blacklisting of Chinese companies, including subsidiaries of banned parent companies, in a move that angered Beijing. China responded by threatening to withhold a range of materials used by U.S. companies.
“President Trump has no choice but to forcefully respond to China’s action,” said Chris McGuire, a former National Security Council deputy senior director for technology and national security under the Biden administration. “He also is correct that the United States has numerous response options that would cause China significant short-term pain, particularly in the technology and financial sectors where China remains highly dependent on the United States.”
While Trump said Friday on Truth Social that “for every Element that they have been able to monopolize, we have two,” there has been concern among U.S. national security experts over how effectively the Trump administration will be able to respond.
The House Select Committee on China encouraged the administration to take immediate steps to “throttle” the country’s tech sector, including banning advanced chip exports to China and delisting Chinese companies from U.S. exchanges.
John Moolenaar (R-Michigan), the committee chairman, said in a statement that the Chinese measures represent “an economic declaration of war against the United States and a slap in the face to President Trump amid his efforts to fight for a level playing field.” Rep. Raja Krishnamoorthi (D-Illinois), the top Democrat on the committee, said China’s restrictions show it is “willing to use its control over critical materials as a tool of coercion.”
Some analysts, however, warned that Xi’s moves were intended to keep Trump from pushing too hard in negotiations.
“We’ve seen Trump threaten to blow up the relationship at least three separate times this year, but each time he came back to the table because he knows that China can hurt the U.S. as much as he can hurt China,” said Jake Werner, director of the East Asia Program at the Quincy Institute. “I think that will be the outcome this time, too.”
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