Wall Street stock index futures fell sharply in a volatile session on Sunday evening after U.S. President Donald Trump said he would hike U.S. tariffs on $200 billion (152 billion pounds) worth of Chinese goods this week and soon target hundreds of billions more.
Futures on the S&P 500 Index slid 1.8 percent as of 11:15 a.m.in Hong Kong.Contracts on the Nikkei 225 Stock Average fell 2.3 percent in Chicago.China's CSI 300 Index tumbled 5.3 percent, the most since October on an intraday basis.
"What is of vital importance is that we still hope the United States can work hard with China to meet each other half way, and strive to reach a mutually beneficial, win-win agreement on the basis of mutual respect", Geng said.
The flight to safety saw the dollar surge against higher-yielding, higher-risk units, with South Africa's rand off one percent, the Mexican peso 0.9 percent lower and the Australian dollar 0.6 percent lower.
Investors pulled back from riskier bets on fears the trade battle between the world's biggest economies was escalating, especially since recent gains in US equities were at least partly due to optimism they would reach a deal.
He vowed to increase American tariffs on $200 billion of Chinese products from 10 per cent to 25 per cent within days, significantly raising the stakes before a crucial round of negotiations in Washington this week.
The reaction has been swift from economists and markets analysts.
July 6: United States and Chinese tariffs of 25 per cent on US$34 billion of each other's goods go into effect.
Joyce Chang, the chair of global research at JPMorgan Chase, was just as gloomy.
"It's making the outcomes more binary, with everybody focused on the Friday deadline".
"There doesn't seem to be much leeway now to much go past that". The International Monetary Fund, the World Bank, and others have downgraded their forecasts for the world economy, saying the US-China standoff is reducing world trade and creating uncertainty for companies trying to decide where to buy supplies, build factories, and make investments. Let Trump raise tariffs. "Let's see when trade talks can resume", Hu Xijin, editor-in-chief of the tabloid the Global Times, tweeted.
"The president is, I think, issuing a warning here, that, you know, we bent over backwards earlier, we suspended the 25 per cent tariff to 10 and then we've left it there".
"We are also in the process of understanding the relevant situation". China has long ago prepared for the worst.
- India, the world's biggest buyer of USA almonds, on June 21 raised import duties on the nuts by 20 per cent and increased tariffs on a range of other farm products and United States iron and steel, in retaliation for U.S. tariffs on Indian steel. "Moreover, he didn't even scare North Korea [referring to U.S. peace talks]". But this is unlikely to happen now. 325 Billions Dollars of additional goods sent to us by China remain untaxed, but will be shortly, at a rate of 25%. That follows talks in April in Beijing that Treasury Secretary Steven Mnuchin called "productive".