Truce fizzles as U.S.-China trade tensions return to full boil

For months, bubbling trade tensions between China and the U.S. seemed to calm to a simmer, with words like “thaw” and “truce” swapped in for warnings of economic “war.” Now, hostilities appear to be returning to full boil. A series of tit-for-tat moves this week by the two superpowers has thrust trade hostilities back in the global spotlight, roiling markets and raising alarms of what might come next.

“Let’s poke the bear again,” economist Aleksandar Tomic, an associate dean at Boston College, said of the renewed sparring. “Let’s stir the hornet’s nest.”

A look at where things stand in the U.S.-China trade standoff:Tensions between China and the U.S. transcend any presidency or political party. But Donald Trump’s return to the White House has brought new levels of rancor. A volley of tariffs were introduced, raised and reduced in the year’s first half, igniting retaliation from Chinese leader Xi Jinping. But more recently, several months of relative calm had prevailed.

That truce showed signs of fizzling this week, though, with China announcing strict new limits on exports of rare earth minerals crucial to high-tech products. Trump, in turn, threatened an additional 100% tax on Chinese imports by Nov. 1 and export controls on American software. Both sides also hit one another’s ships with new port fees.

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