Trump’s 15% tariff on $112B Chinese goods will cost American consumers $1K annually

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The Trump administration’s latest 15 percent tariff on $112 billion worth of products from China took effect on Sunday.

Chinese products affected by the tariff include clothes, footwear, television, video consoles, sporting goods and other consumer products. American consumers will feel the pain as companies plan to increase prices on Chinese imports.

A 15 percent tariff will be imposed on another batch of approximately $160 billion in Chinese goods including laptops and cellphones on December 15. The new duties are expected to ruin the holiday shopping season for both consumers and retailers.

The White House has been locked in an escalating trade war with Beijing. Last month, President Donald Trump said his administration will increase tariffs on $550 in Chinese goods. He also ordered American companies to come home and make their products in the United States.

His administration’s move comes after China imposed new tariffs on $75 billion U.S. product, which the President considered as “politically motivated.”

Trump’s tariffs will significantly Americans before the 2020 presidential election

JP Morgan warned that the additional tariffs on Chinese imports will hurt the budgets of American consumers. The financial services firm estimated that average U.S. households will face $1,000 in additional costs annually due to the new duties.

Without the new tariffs, the financial services firm estimated that the trade war will cost American consumers $600 per year.

In a report earlier last month, JP Morgan equity strategist Dubravko Lakos-Bujas and his team stated the Trump’s tariffs on Chinese products will have a significant negative impact on the “wallet of the US/consumer voter ahead of the 2020 election.”

China suggests U.S. faces a “bigger risk” of economic decline

On Sunday night, China’s Global Times published an editorial indicating that the “Trump administration shot Americans in the foot” with the new tariff.

The newspaper also suggested, “The US economy cannot sustain its superficial prosperity and is facing a bigger risk of decline. US GDP growth was 2.1 percent in the second quarter of 2019, 1 percentage point lower than the first quarter…When more and more Americans feel the pain, maybe it will be time for Washington to recover rationality.”

Meanwhile, President Trump told reporters on Sunday, “We are talking to China, the meeting is still on.” He reiterated, “We can’t allow China to rip us off anymore.”