U.S. President Donald Trump said on Friday he is considering a major increase in tariffs on Chinese imports. He added that he saw little point in meeting with Chinese President Xi Jinping in two weeks as planned, saying there was “no reason to do so.” The statement triggered a sell-off in the U.S. dollar and renewed market uncertainty.
China Tightens Exports, Trump Threatens Tariffs
China, earlier this week, tightened export controls on key rare earth materials. On Friday, it announced additional port fees on U.S. ships starting October 14. The measures were seen as part of the ongoing trade tensions between the two countries.
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“Some very strange things are happening in China!” Trump posted on social media. He also threatened to cancel the meeting with Xi and warned of a “massive increase” in tariffs.
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Market Slides Amid Trump’s China Remarks
Following the comments, U.S. stocks fell sharply. The Dow Jones Industrial Average dropped 0.8%, or more than 350 points. The S&P 500 declined 1.3%, and the Nasdaq Composite fell over 2%, led by losses in technology shares.
Investors also focused on private economic reports as official data releases remained on hold. The U.S. government shutdown entered its tenth day, delaying several scheduled updates on the economy.
U.S.-China Rare Earth Deal Announced
Earlier, the U.S. and China finalized a trade agreement focused on rare earth minerals. The deal aims to address supply chain concerns for critical manufacturing components, including microchips.
Following the announcement, major U.S. and Asia-Pacific stock indices rose. Technology companies such as Nvidia, Apple, and Amazon gained, while some rare earth mining firms saw declines amid expectations of increased supply from China.
The full impact will depend on the deal’s implementation and further negotiations.
