'100% tariff is not sustainable': Trump says in a yo-yo move towards China ahead of meeting with Xi Jinping

On Friday (Oct 17), US President Trump said that the 100 per cent proposed tariff on Chinese goods entering the American market was not a permanent decision. He said that it was a measure he had to resort to to pressure Beijing ahead of his meeting with his Chinese counterpart, Xi Jinping. “A 100% tariff is not sustainable; they (China) forced me to do that,” Trump told Fox Business Network in an interview.

It was on October 10 that Trump announced a 100 per cent tariff on China and said it would be effective from November 1. And now, the 79-year-old said it was only to pressure China. In his social media post, Trump wrote, “Given China’s unprecedented stance, the United States will impose a 100 per cent tariff on China, in addition to any tariffs currently in place.”

In his previous post, Trump also said that he may not meet with Chinese President Xi Jinping amid the Asian country tightening its rules on rare earth elements' export. After Trump's post, the financial markets saw huge drop with S&P 500 going down roughly 1.2 per cent in late morning trade. The US president also accused China of 'becoming very hostile' ahead of their scheduled meet in two weeks' time in South Korea.

Markets down after Trump's post

As soon as Trump posted these matters on social media, the financial markets were down in the late morning trade in New York as a result. The Dow Jones Industrial Average was down 560 points, or 1.2 per cent and the S&P 500 lost 1.7 per cent. The setback on the market came as US government shutdown entered its 10th day on October 10 - adding to already bearish sentiment of the market.