China hits back against Donald Trump's tariffs, saying it will impose an additional 34% tax on US goods from next week
European markets fall further in response, with indexes in London, Berlin and Paris all down more than 3%
Trump announced a 54% import tax for China – one of the highest rates for any country
Need catching up on the basics? Read our summary here
Meanwhile, a treasury minister tells the BBC the UK is working "at pace" to secure a deal on trade with the US
How could the tariffs affect you and your money? Our business reporter breaks down the UK impact
Edited by Tinshui Yeung and Rorey Bosotti
Paul Kirby
Europe digital editor
Shares in some of Europe's biggest companies have nosedived in response to China's 34% tariff on US goods.
The Milanstock market has fallen 7%, with banking and insurance shares well down: financial group Unipol has plummeted 13%, Unicredit and Bper are down 11%, and Intesa and Banca Popolare di Sondrio have both lost 10% of their value.
The DAX in Germany lost hundreds of points in a matter of minutes as banking shares and industrials tumbled. Deutsche Bank was down over 10%, while Daimler, Mercedes-Benz and MTU Aero Engines have slipped by between 5% and 7.5%.
In France, banking groups Société Générale and BNP Paribas were down 10.8% and 8.6% respectively while car group Stellantis lost 8.5% of its value and steel firm ArcelorMittal was down 10%.
In Amsterdam Dutch insurer Aegon and banking group ING are both down by more than 9%.
Tom Espiner
Business reporter
After a shaky start on Friday, European markets are falling further after China said it would impose retaliatory tariffs of 34% on all US goods from 10 April.
Indexes in the UK, Germany and France are all down more than 3%. Asian markets also dropped earlier.
The sweeping new tariffs announced by President Donald Trump on Wednesday sparked a global stock market sell-off, with US markets suffering their worst day since the Covid pandemic hit in 2020.
Traders are worried the tariffs will push up prices and slow growth both in the US and around the world.
We’ve got more now on China’s response to US tariffs, after Beijing says it’s hitting back with a 34% tariff on American goods.
A spokesperson at the ministry of commerce says China has also filed a lawsuit with the World Trade Organization (WTO).
The US-imposed tariff "seriously violates WTO rules, damages the legitimate rights and interests of WTO members, and undermines the rules-based multilateral trading system and the international economic and trade order," the spokesperson says.
"It is a typical unilateral bullying practice that endangers the stability of the global economic and trade order. China firmly opposes this."
China has just said it will add a 34% tariff on US goods starting from 10 April.
Its finance ministry says the US tariffs on Chinese products are "not in line with international trade rules".
US President Donald Trump has announced 54% tariffs on China, which include previous duties already in place. That makes China one of the hardest-hit countries on America's tariff list.
As the UK continues talks with the US to reach a deal, some countries are bringing in measures – either to get ahead or in response.
Let's take a look at a few of them:
Oliver Smith
Business producer
A 10% tariff will hurt UK businesses exporting to the US – but it could have been worse.
Still, some are seeing possible upsides.
I've been speaking to a UK electric motorbike manufacturer. The US is a growing market for him, and with his bikes seen as luxury items, he’s understandably worried.
But with Chinese rivals now facing a 34% tariff, his prices suddenly look more competitive.
A chemicals firm also tells me he’s lost some US business to companies in China and India over the years. With both countries now facing higher tariffs than the UK, he’s hoping American customers might take another look at his products.
But he’s also cautious. If Chinese and Indian goods become harder to sell in the US, they could be diverted to the UK – undercutting his business here.
That might be good news for UK buyers, but not for him.
As we've mentioned earlier, Nato foreign ministers are meeting in Brussels.
UK Foreign Secretary David Lammy has been speaking to reporters, saying the UK is "a nation that believes in open trade".
He says the UK is "engaged in discussions with the United States to strike an economic agreement and an economic deal".
He adds that the national interest will come first, and "it's in their national interests to be negotiating with the United States an economic agreement at this time, but keeping all options on the table".
Farmers in the US are "disappointed" by Donald Trump's new tariffs, the head of a farmers union has told BBC Radio 4's Today programme.
"We're disappointed that they are so widespread and affect so many products," says Chad Franke, president of the Rocky Mountain Farmers Union.
He says the farmers he represents are worried about retaliatory tariffs from other countries, as agricultural goods are often the first to be hit.
All tariffs are likely to cause disruption to the industry, he adds, as farmers need to plan "years in advance", making it "really difficult to change quickly".
Faisal Islam
Economics editor
All the chips have been thrown up in the air by the American actions. All assumptions about how global trade functions will have to change.
Some of the seasoned market observers I’ve spoken to suggest that even the sharp falls we saw in the US markets yesterday are underpinned by the idea that this full tariff package won’t actually happen.
But if it does, it raises serious questions about whether the US government’s approach is undermining the strategies of some of America’s biggest blue-chip businesses.
Their current supply chain strategies involve finding the most cost-effective places in the world to make their goods. Now, they’re being told to “make American”.
There’s another factor here. Most of the world’s trade doesn’t happen through America. I've been struck by a lot of the comments from around the world – with many nations not wanting to be seen to give in to what they see as coercion from the US.
We’ve already seen the Canadians try to join forces with the EU. Some of Trump’s proxies on social media are saying world leaders should strike a deal with the US president now – get to the front of the queue – because they’re worried, I think, about a co-ordinated response.
As we mentioned earlier, US President Donald Trump spoke to reporters on board Air Force One yesterday after announcing new tariffs.
Let’s recap what he said:
If you scan across Donald Trump’s tariff chart, you'll see that the value in the second column equals roughly half of the number in the first column for most countries. There's a reason for that.
The two columns represent:
Initially, it was assumed that the figures were based on existing tariffs plus other trade barriers (like regulations and licensing rules) which make trade harder.
But, the White House has now published its official methodology, and it turns out there is a simple equation behind it.
The calculations are based on a country’s goods trade deficit with the US. In other words, how much more the US imports than it exports. This number is then divided by the total value of imports from that country.
Let's use China as an example: The US buys more goods from China than it sells to them – there is a goods deficit of $295bn and the total amount of goods it buys from China is $440bn.
Then, we find the percentage difference between those two numbers, which = 67% – that's the number which appears in the first column of Trump’s chart.
And to work out column two – the tariff the US wishes to impose – you simply divide that number by two.
So in China’s case, the result is 34, and there you have the tariff.
Ottie Mitchell and Tiffanie Turnbull
BBC News, Sydney
Two tiny, remote Antarctic outposts home to penguins and seals have also ended up on the list for Trump’s new tariffs.
Heard and McDonald Islands – a territory about 4,000km (2,485 miles) south-west of Australia – can only be reached by a week-long boat trip from Perth, and haven’t seen human visitors in almost a decade.
“It just shows and exemplifies the fact that nowhere on Earth is safe from this,” Australian Prime Minister Anthony Albanese said on Thursday.
Read more about how an island of penguins found itself on Trump’s tariff list.
Some Canadians may be angry about Trump's policy, but others are finding it amusing.
One of the targets of Trump’s tariffs is Norfolk Island – a tiny Australian territory with about 2,200 residents.
The island’s been hit with a 29% tariff.
Locals say the economy relies on tourism and they don’t export anything to the US – so the tariff has become something of a running joke.
“Everyone's laughing about it,” Gye Duncan, a former resident, tells Reuters news agency. “They're either laughing about it or confused why because there's no real reason, or no logical reason why he (Trump) would do that.”
People on the island are hoping the sudden international attention will give them a much-needed publicity boost and attract more visitors to the rugged volcanic island in the southern Pacific.
Robin Levinson King
Reporting from Toronto, Ontario
At her local grocery store, Benedykta Mazur has taken on the role of a bit of a sleuth.
Since Donald Trump launched a trade war with Canada, she's been doing her best to buy Canadian wherever she can.
She refuses to buy anything grown or made in the US.
"It's a no, an absolute no," she tells me. "This is something that is not going to be just kind of wishy washy."
Mazur says that while Canadians are known for being "really nice", it's time to focus that friendliness elsewhere and build ties with countries that "share commonalities in regards to how you treat another person, because countries are made of people".
Nato foreign ministers are meeting in Brussels today to talk about Russia’s war in Ukraine – but some are also reacting to Trump’s sweeping tariffs.
UK Foreign Minister David Lammy says he regrets the "return to protectionism in the US", while Canadian Foreign Minister Mélanie Joly says Canada’s relationship with the US will never be the same again.
Joly also says Canada is putting maximum pressure on the Trump administration.
We’re expecting to hear from US Secretary of State Marco Rubio, who’s also in Brussels, a bit later today.
Just a reminder – Canada wasn’t on the list of new tariffs announced this week, but Trump had already imposed a 25% tariff on goods coming into the US from Canada. He’s also previously called for Canada to become the US’s 51st state.
Ali Abbas Ahmadi
Reporting from Windsor, Ontario
Carmaker Stellantis says it will temporarily shut down its assembly plant in Windsor, a Canadian city on the US border, next week because of car tariffs announced by US President Donald Trump.
Derek Gungle, who works on the assembly line at the plant, says the news was “kind of expected” after the tariffs were announced – but still “scary, very scary”.
Speaking quietly after giving several interviews, Gungle says Windsor depends heavily on cross-border trade, and any threat to that could have devastating consequences.
If the shutdown becomes permanent or he loses his job, Gungle says he has “no idea” what he’ll do.
The boss of construction giant JCB has urged the UK government not to hit back at Donald Trump’s tariffs, warning it could lead to “a trade war we can only lose”.
It comes after the UK published a 417-page list of US goods that could face tariffs in response.
JCB has announced it will double its investment in a new factory in Texas, but chief executive Graeme McDonald says this won’t affect jobs in the UK.
“We can’t ignore the biggest market in the world,” he tells BBC Radio 4’s Today programme, adding the best way to deal with the tariffs is to “make in America”.
Trump has said companies producing in the US won’t face tariffs, but McDonald says it’s still unclear what “make in America” actually means, given global supply chains.
His message to the UK government: “do not retaliate, negotiate” – as there’s “a deal to be done” with the US.
Jim O’Neill, former chief economist at Goldman Sachs and treasury minister, says the UK should think about what it can gain from and offer to the rest of the world in response to US tariffs.
Speaking to BBC Radio 4’s Today programme, O’Neill suggests the UK should talk to other G7 countries about lowering trade barriers, especially for cross-border services, “which is what the UK has a marginal advantage in”.
“The most important thing is to try to more seriously pursue the obvious things elsewhere in the world that would be to our benefit – I’d include China and India in that too,” he says.
O’Neill also says that if the US wants to impose tariffs, it’s “in the bounds of feasibility” for other big economies to restructure and stop their “addiction to the US consumer”.
The UK government is "working at pace" to secure a trade deal with the US, a treasury minister tells the BBC.
Speaking on BBC Radio 4’s Today programme, James Murray says the government is "disappointed" global tariffs have been introduced, but it will keep a "cool head" and take a "pragmatic approach".
The focus is on getting a trade deal, says Murray, but the government is keeping "everything on the table" when it comes to its response.
Chris Mason
Political editor
President Trump's lament about the consequences of deindustrialisation in America and his reaction to that is prompting the UK and others to have to think nimbly and devote considerable bandwidth to preparing contingencies for what might happen next.
How should we understand and grapple with the magnitude of what we are witnessing?
Prime Minister Keir Starmer is not a man known for flights of rhetorical fancy.
So it is instructive to see how he is articulating this moment.
He claimed it was "the beginning of a new era for trade and the economy" and not just this, but was the second such paradigm shift we have witnessed just in the last few months.
There was already the beginnings of a new era for defence and security, he suggested, with the UK, Germany and others committed to ramping up spending on the military.
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