China has responded to President Donald Trump’s latest 104 per cent tariffs imposed on its products entering the United States as the American leader moves to punish Beijing for standing up against his ‘Liberation Day’ reciprocal tariffs announcement.

The latest tariffs against China came into effect on Wednesday after Beijing matched the United States’ previous 34 per cent tariff imposed on most Chinese products in a ‘Liberation Day’ declaration by Mr Trump last week that targeted almost all U.S. trading partners with various tariffs.

Meanwhile, Mr Trump immediately responded to China’s decision to impose its own tariffs on the United States as well as putting restrictions on exportation of seven rare earth minerals, food and pharmaceutical products to the U.S. by increasing the previous tariff from 70 per cent to 104 per cent.

Within hours after the tariff went into effect, Beijing responded by increasing the tariff on American exports to China from the previous 34 per cent to 84 per cent, which is expected to go into effect on Thursday as tussle continues between the two economic powers. 

The Chinese Finance Ministry last week condemned Mr Trump’s new trade policy, stating that “This practice of the U.S. is not in line with international trade rules and seriously undermines China’s legitimate rights and interests, and is a typical unilateral bullying practice.”

Stock markets around the world have recorded significant losses since Mr Trump’s ‘Liberation Day’ announcement, with government bond yields rising sharply as the tumult has started spreading to the market, traditionally seen as a haven in times of uncertainty.