Tariff Time Again: What New US Tariffs on China Mean for Your Crypto
It’s another day, another round of US tariffs aimed at China. The White House announced new duties reaching up to 245% on Chinese imports Wednesday, marking a significant ramp-up in economic tensions between the two superpowers. The move follows a series of tit-for-tat tariff escalations, with the US citing national security concerns and China’s retaliatory measures as justification for the massive rise.
This announcement is fresh, so the full market reaction is still unfolding, but volatility is expected. Previous rounds of tariff hikes definitely caused chaos across financial markets, crypto included. US stock indices experienced notable declines, with the S&P 500 falling by 3.45%, the Nasdaq dropping 4.31%, and the Dow Jones Industrial Average decreasing by 2.54%.
Crypto had a similar pattern, if not worse, depending on the cryptocurrency. For instance, Bitcoin dropped to below $75k, a big decrease from January when it was over $100k. Currently, the price sits in a range of $83k – $84k.
Granted, this was all during the announced tariffs on the majority of countries. Eventually, those got paused for 90 days, bringing some stability back. However, China was exempt, and there’s a chance the crypto market won’t take that much of a beating this time.
While these new tariffs are steep, their immediate effect might be less severe than some previous rounds. This is mainly because the previous tariff announcements, especially first-time policy shocks, tend to cause more panic than follow-up increases.
Also, unlike before, this is only aimed at one country, compared to almost the entire planet before. Plus, so far, the tech products such as smartphones, computer monitors, and various electronic parts are not part of these tariffs.
Still, if China retaliates again, which is more than a likely scenario, it might bring further instability to the crypto and financial markets. Keeping an eye on Fed statements and bond market behavior will potentially tell us how real the ripple effect is going to be.
On the other hand, some analysts believe that aggressive tariff policies are weakening the US dollar (which does track, considering the US dollar is weaker now, compared to the beginning of March). This could benefit Bitcoin and other crypto assets, as they become more appealing as alternative stores of value.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
Powell Speaks, Stocks Sink: Fed Chair Worried About Trump Tariff Fallout
Federal Reserve Chair Jerome Powell cautioned Wednesday about growing economic uncertainty tied to President Donald Trump’s tariff policies, warning they have hit major U.S. stock indices.
Speaking at the Economic Club of Chicago – in an interview with Raghuram Rajan (University of Chicago Booth professor and former Reserve Bank of India Governor) – Powell stated the announced trade measures were larger than expected and will likely result in higher inflation and weaker growth.
Markets reacted immediately following Powell’s statement near the end of the trading session. The Dow Jones Industrial Average dropped 690 points, 1.7%. The S&P 500 fell 2.2%, while the Nasdaq Composite experienced the largest decline, closing 3% lower.
Related: China Stocks Crash 7% While US Markets Soar: Crypto Implications
Investor sentiment had already been under pressure following a disclosure by chipmaker Nvidia. The company reported a $5.5 billion charge associated with new export restrictions to China imposed under the Trump administration. The announcement heightened market fears, compounding the effect of Powell’s caution on growth and inflation.
Powell explained the Federal Reserve will adopt a “wait-and-see” approach before changing interest rates, He cited the need for greater clarity regarding the economic effects of current trade policies.
These remarks were Powell’s first public comments since the White House temporarily paused some reciprocal tariffs last week (a move notably excluding tariffs on China).
The pause in tariffs prompted a market recovery. Stocks surged in response to the announcement, rebounding from initial losses tied to the earlier trade measures. However, Powell’s comments suggested that the overall economic outlook remains uncertain due to the scale of the policy changes.
Contrasting the market jitters, new data from the U.S. Census Bureau showed a surprise jump in retail activity. March sales increased over 1.4%, marking the biggest monthly rise in over two years.
Related: Crypto Markets Lose $1.25 Billion as Fed Warns of Higher Inflation in 2025
Analysts partly attribute this surge to consumers buying ahead of anticipated higher prices from tariffs.
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
Stocks trim gains as China signals readiness for trade talks
Stocks trimmed gains, led by global chip makers, to see the U.S. stock market opened on Wednesday, April 16.
Although the likes of Nvidia were slightly up as investors reacted to news China had indicated its readiness to engage the United States amid ongoing tariffs war, earlier losses impacted greater sentiment and contributed to the major indices opening lower.
Nvidia (NVDA), Advanced Micro Devices (AMD), Micron Technology (MU), and ASML Holding (ASML) all fell sharply in premarket trading. The stocks flipped green ahead of Wall Street’s open, but the cautious sentiment lingered after the bell as Washington’s ramped-up tariffs on China imposed further jitters.
In particular, the latest move to curb exports of an artificial intelligence chip Nvidia makes for the Chinese market contributed to the earlier rout, with global chip makers AMD and ASML also feeling the pressure.
Nvidia’s warning regarding a $5.5 billion quarterly charge amid the AI chip curbs saw NVDA stock dip 6%. AMD, ASML, and other chip stocks also recorded notable losses.
The S&P 500 and Nasdaq dropped by 1.2% and 2.1%, respectively, while the Dow Jones Industrial Average opened about 0.6% lower.
Optimism remains tempered but investors appear to be seeing an imminent thaw in the China vs. U.S. tariffs arena. Despite President Donald Trump’s administration noting China faced up to 245% in tariffs amid the recent standoff and retaliatory moves, Beijing has signalled it may be willing to come to the table.
However, China says this readiness for trade talks comes with demands of “respect” from U.S. counterparts.
While this course of events might see a slight uptick in investor sentiment, stocks are largely unmoved . Crypto also notched a slight dip as the S&P 500, Nasdaq Composite and DJIA all opened lower on Wednesday.
Meanwhile, retail sales rose 1.4% in March, aligning with consensus estimates. With recent positive inflation readings doing little to lift markets, the focus remains on what this means for the overall U.S. economic outlook before the reciprocal tariffs kicked in on “Liberation Day.”