Image

The gulf is widening between the United States and China over their tit-for-tat tariff clash.Credit…Kevin Lamarque/Reuters

There’s no letup in sight to the trade war: This morning, China raised its tariffs on U.S. imports yet again.

Beijing said it would not make economic sense to raise them further, and called the Trump administration’s dizzying tariffs barrage “a joke.” And this morning, Tesla stopped taking orders in China for two models it imports from the U.S. (That raises the question: What does Elon Musk think about how President Trump’s trade fight is going?)

The U.S. dollar and Treasuries are being battered as well, casting further uncertainty over their safe-haven status.

Where things stand: As of tomorrow, Chinese levies on U.S. goods will rise to 125 percent from 84 percent. That’s after the Trump administration placed 145 percent tariffs on imports from China; the White House has also put 10 percent tariffs on most other trade partners as it faces a 90-day deadline to reach scores of trade deals.

Meanwhile:

• The dollar is falling sharply again, having suffered its biggest drop against the euro in a decade.
• The 30-year Treasury bond is more stable, but is on track for its worst week since the 1980s, according to Deutsche Bank research.
• West Texas Intermediate, the U.S. oil benchmark, is trading around $60. Its significant drop this week is being cheered on by the White House, but could exacerbate the trade deficit, Bloomberg Opinion’s Javier Blas writes.
• Just in: JPMorgan Chase reported gains in its core consumer lending, investment banking and trading businesses for the first quarter. But Jamie Dimon, the bank’s C.E.O., warned that “the economy is facing considerable turbulence.”

Watch the market volatility closely. Treasury Secretary Scott Bessent said on Thursday that he saw “nothing unusual” about the market swings. But simultaneous drops in the dollar, stocks and long-dated Treasury bonds are extreme, especially in the United States, and suggest a potentially larger capital flight away from U.S. financial assets, analysts noted.

Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.

Thank you for your patience while we verify access.

Already a subscriber? Log in.

Want all of The Times? Subscribe.