NEW DELHI: In a fresh escalation of the US-China trade war, China announced on Friday that it will raise tariffs on American goods to 125%, up from the previous 84%. The move follows US President Donald Trump's decision earlier this week to hike tariffs on Chinese imports to a staggering 145%.

The announcement came just hours after Chinese President Xi Jinping urged the European Union to stand with Beijing against what he termed "unilateral bullying"—a pointed reference to Washington’s aggressive tariff stance.

China's new tariffs will take effect on Saturday. In a strongly worded statement, the Chinese Finance Ministry dismissed the latest US measures, stating that "at the current tariff level, there is no possibility of market acceptance for US goods exported to China."

"The United States' repeated imposition of excessively high tariffs on China has turned into a numbers game devoid of economic rationale," the ministry said, warning that any further tariff moves by the US will simply be "ignored."

Beijing further blamed the Trump administration for the broader disruption to the global economy. A spokesperson for China's Commerce Ministry said Washington's actions had triggered "serious shocks and severe turbulence" in global markets and trade systems.

The tensions intensified after Trump announced a 90-day suspension of tariffs on all countries except China, citing a "lack of respect" from Beijing. Earlier in the week, the US had implemented a fresh round of tariff hikes, increasing duties on Chinese goods to 104%.

In response, China initially raised its tariffs on US products from 34% to 84%, before Friday’s announcement pushing the rate to 125%.

Xi Jinping Urges EU to Join Forces

President Xi, during a meeting in Beijing with Spanish Prime Minister Pedro Sánchez, reiterated China's stance that there are "no winners" in trade wars. According to state-run Xinhua News Agency, Xi called on Europe to work with China in opposing unilateral trade actions.

“China and Europe should shoulder their international responsibilities together and resist unilateral bullying,” Xi said, emphasizing that such cooperation would not only defend shared interests but also uphold international justice.

Trump: "I Think He’ll Want to Make a Deal"

Despite the escalation, President Trump struck a conciliatory tone during remarks at the White House, describing President Xi as “a smart man” and expressing optimism that a resolution could be reached.

"I think President Xi knows exactly what needs to be done," Trump said. "He loves his country. I know him well. And I think he's going to want to make a deal. We'll get a phone call at some point, and everything will be ready."

"It’s going to be a great thing—for us, for the world, and for humanity," he added.

As the tit-for-tat tariff battle continues to unfold, global markets and economies brace for further uncertainty.