China Shares Drop, Yuan Falters on New U.S. Tariff Threats

China Shares Drop, Yuan Falters on New U.S. Tariff Threats

United States ambassador Dennis Shea, who was among the first to speak at the closed-door review, argued that China had exploited its membership to take advantage of other nations and that if unchecked Beijing's misconduct would ruin the WTO.

Pushing past 112 "would suggest the market is bullish on the dollar irrespective of the trade war", said Boris Schlossberg, managing director of FX strategy at BK Asset Management.

U.S. Trade Representative Robert Lighthizer said the tariffs of 10 percent are "a result of China's retaliation and failure to change its practices" in response to earlier U.S. tariffs.

"Trade experts we have consulted point to the potential for anti-U.S. social media campaigns, delays or blockage of regulatory approvals, travel bans, investment restrictions, among other options", Raymond James analyst Ed Mills said in a report. These tactics include the outright theft of trade secrets, government subsidies to homegrown tech firms and demands that USA and other foreign companies hand over technology if they want access to China's vast market.

The list covers some $200 billion in Chinese exports that could be hit by a 10 percent tariff.

US crude oil futures settled down 5 percent on the trade dispute escalation and as expectations of growing supplies increased on news that Libya would reopen ports.

The American announcement came Tuesday - days after the US began adding 25 percent tariffs on $34 billion of Chinese goods.

An all-out trade war with China could affect a third of all US imports, data from Deutsche Bank Torsten Slok show.

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The US complains that China uses predatory practices in a push to challenge American technological dominance.

USTR will hold hearings in late August on the list of targeted products, and an administration official said it would take about two months to finalize, at which point Trump would decide whether to go ahead with the tariffs.

Last week, China and the USA imposed another round of tariffs on each other, and the USA said on Tuesday that it could impose tariffs on an additional US$200 billion worth of Chinese imports.

"China is forced to strike back to safeguard core national interests and the interests of its people", the Commerce Ministry said. "If the US goes ahead with more, China needs a combination of tools and it is prudent to guard against downside risk to growth too". Those nations have also retaliated.

The Retail Industry Leaders Association, a lobby group representing the largest U.S. retailers, said: "The president has broken his promise to bring 'maximum pain on China, minimum pain on consumers'".

"Tariffs are taxes, plain and simple. Cooperation is the only correct choice between China and the United States". The US had said it would consider requests from some countries to be exempted from other sanctions that it plans put into effect in November that prevent Iran from exporting oil.

China has become a key trade partner for US energy exports, and potential tariffs on USA energy goods could hurt USA producers and industries.

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