The $2.18 billion cost of China’s retaliation against Trump’s tariffs
The U.S.-China trade war reached a crescendo in September with the imposition of duties on around $260 billion of bilateral trade at rates of 5% to 10% (referred to as list 3 products). That came on top of duties on $100 billion of trade in July (list 1) and August (list 2) at a 25% rate. The expansion of the U.S. trade deficit with China to a record $40.2 billion in September is a sign the trade war went against America that month.

Indeed, U.S. exports of the products covered by list 1 fell 66.3% on a year earlier in September and list 2 products by 50.3%. List 3 saw a slide of just 0.7% though that followed two months of expansion and duties were only applied from Sept. 24. Much of the $2.18 billion decline in list 1, 2 and 3 products was explained by commodities including soybeans ($1.07 billion) and the autos sector ($216 million).

Notably products not covered by the three lists surged 36.7% higher. That could concerns among exporters not facing tariffs yet that there may not be an “off-ramp” from widening duties, raising the stakes for the Dec. 1 meeting scheduled between President Donald Trump and President Xi Jinping.