The United States has officially enacted a steep 104% tariff on imports from China, sharply intensifying trade tensions between the two economic giants. The new tariff regime, confirmed by the White House, went into effect on April 9 and follows a series of escalating duties imposed by President Donald Trump, including a 20% hike in March and another 34% last week.

This bold move comes after Trump gave Beijing a 24-hour deadline to withdraw its retaliatory 34% tariffs on U.S. products. With China standing firm, Washington pushed forward with the highest round of duties yet.

Just before the latest announcement, Chinese Premier Li Qiang had a phone conversation with European Commission President Ursula von der Leyen, during which he strongly criticized rising protectionism and unilateral trade actions. “Only openness and cooperation can lead to shared progress,” Li said, voicing Beijing’s commitment to maintaining a stable economic trajectory despite growing pressure.

Li also emphasized that China's economic strategy for 2025 already accounts for external challenges, and reassured that the country has sufficient policy tools to cushion against global shocks.

The U.S. action also comes with a fresh wave of tariffs targeting the European Union, which now faces a 20% levy under Trump’s "reciprocal trade" approach. A senior U.S. official confirmed to Bloomberg that there will be no rollback or delay in implementation.

White House Press Secretary Karoline Leavitt said Trump was determined to follow through. “He made it clear — these tariffs are going into effect. He’s sending a message to the world that American interests come first,” she told reporters.

Beijing has not backed down either. Following the initial 34% tariff from the U.S., China imposed an equivalent 34% tariff on American goods starting April 10. China’s Commerce Ministry called the U.S. move a “deliberate act of pressure” and pledged strong retaliation.

As part of its response, China also announced new export controls on key rare-earth elements including samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium — effective from April 4.

The financial markets have reacted swiftly and sharply. The S&P 500 has fallen by 20% from its February high, while the Dow Jones has dropped over 17%. The Nasdaq entered bear market territory last week, reflecting widespread investor anxiety. In Asia, China’s Hang Seng Tech Index has plunged 27% in a month, and the yuan has slid to its lowest point since January. Interestingly, Chinese government bonds have seen a rally amid the turmoil.

In a broader show of tough trade policy, Trump also levied a 26% tariff on Indian exports earlier this month, citing “reciprocal” treatment.