President Donald Trump has threatened to impose 100% tariffs on Chinese goods starting 1 November — or sooner — accusing Beijing of “very hostile” actions after it tightened controls on rare-earth exports.
The move reignited fears of a new trade war between the world’s two largest economies, sending Wall Street tumbling. The S&P 500 fell 2.7%, the Dow Jones dropped 1.9%, and the Nasdaq sank 3.6%, with tech giant Nvidia losing nearly 5%.
China produces over 90% of the world’s processed rare earths, crucial for manufacturing electric vehicles, plane engines, and electronics. Its latest export restrictions added five new materials to its control list, alarming global industries.
“I never thought it would come to this,” Trump said on Truth Social, adding that tariffs could rise “over and above” current levels. “It will be painful, but good for the U.S.A. in the end.”
Relations between Washington and Beijing had improved earlier this year after both sides agreed to lower tariffs. But Trump’s latest remarks suggest that a planned meeting with Xi Jinping may now be cancelled.
Trump defended his hardline stance, calling China’s dominance in rare earths “a hostile move.” He added: “There’s no way China should be allowed to hold the world captive.”
The president also announced new U.S. export controls on “any and all critical software,” part of what he described as a wider strategy to strengthen America’s economic position.
Economists warn the renewed tariff threat could drive up consumer prices and worsen global market instability, even as Trump insists higher import taxes will “raise trillions” for the U.S. government.
