ADVERTISEMENTBeijing has warned of retaliatory measures against countries that reach trade agreements with the United States at the expense of China’s interests, as other nations are dragged into the trade war between the world’s two largest economies.
In its latest response to the steeply increased US tariffs, China’s Ministry of Commerce said in a statement that Beijing “respects all parties’ efforts to resolve their trade disputes with the US through equal consultation.” However, China will not accept any US-led trade deals that harm its interests and will “respond resolutely and reciprocally with countermeasures” to safeguard its rights and interests.
In the statement, China described the US tariffs as “unilateral bullying” in international trade, adding that “if international trade regresses to the law of the jungle where the strong prey on the weak, all countries will become victims.”
Last week, the Trump administration was reportedly planning to pressure US trading partners to limit deals with China in ongoing tariff negotiations. Countries with close trade ties to China may face so-called secondary tariffs.
Meanwhile, Chinese President Xi last week visited major trade partners in Southeast Asia, including Vietnam, Malaysia, and Cambodia, on his first overseas trip of the year. The visit signalled “China’s renewed push to reinforce regional stability and prosperity, and its determined support for regional economic integration as global protectionism and unilateralism continue to mount,” the state news agency Xinhua reported.
Non-tariff trade tensions
The tariff war appears to have reached a peak between the US and China, as both sides have indicated no further hikes. Thus far, the US has imposed a total of 145% duties on Chinese goods, while pausing reciprocal tariffs on other nations. China responded with 125% tariffs on US goods and has said it will “ignore” any further increases, calling them a “meaningless numbers game.” Trump has also signalled that no further tariff hikes are likely, citing concerns that additional measures would stall trade between the two countries.
However, the two sides have intensified their trade tensions through non-tariff means. China recently imposed export restrictions on a wide range of critical minerals, particularly targeting the US. A few days later, Trump signed an executive order to investigate imports of critical minerals, stating: “Critical minerals, including rare earth elements, in the form of processed minerals, are essential raw materials and critical production inputs required for economic and national security.”
Adding to the escalation, the Trump administration announced fees on Chinese-built vessels docking at US ports last Friday. The decision, revealed by the Office of the United States Trade Representative (USTR), follows a one-year investigation originally launched under the Biden administration.
While President Trump has repeatedly indicated that China will approach the US to make a trade deal, there is no clear indication from Beijing that an agreement is imminent.
Euro and gold soar as haven demand surges
Trade tensions between the US and China continued to unsettle global markets during Monday’s Asian session. While most Western stock exchanges remained closed for the Easter holiday, risk aversion again dominated market sentiment. Haven assets, such as gold and the euro, soared; meanwhile, the US dollar weakened further, and US stock futures extended losses.
As of 5:50 am CEST, gold futures at COMEX had surged 1.8% to $3,389 per ounce, while spot gold rose 1.4% to $3,376 per ounce—both marking new record highs. The EUR/USD pair surpassed 1.50 for the first time since November 2021. Other haven currencies, including the Japanese yen and the Swiss franc, also strengthened significantly against the dollar.