US China trade war April 16 highlights: California to file lawsuit to block Trump's tariffs, Bloomberg reports

• India plans to end taxes on U.S. ethane and liquefied petroleum gas (LPG) imports under broader negotiations with Washington as it looks to reduce its trade surplus and ease its tariff burden, three sources familiar with the matter said.
• The proposal to get rid of duties for the products used for cooking gas and petrochemical production comes as India mulls scrapping import tax for U.S. liquefied natural gas (LNG) and boosting purchases of the fuel from the United States.
• As President Donald Trump's sweeping duties rattle economies and markets, several Asian countries running trade surpluses with Washington are looking to import more U.S. energy in hopes of avoiding heavier tariffs. - Reuters

California Governor Gavin Newsom announced that the state is filing a lawsuit to block President Donald Trump’s tariffs, arguing that they are damaging to both consumers and businesses in what is the world’s fifth-largest economy.

• China prefers to engage with the European Union as a partner rather than a rival, its ambassador to Spain stated, against the backdrop of evolving global dynamics and what he described as the U.S.'s unilateral and abusive trade practices.
• In an interview with Reuters, Yao Jing criticized the EU’s 2019 strategy that labeled China a “partner for cooperation, economic competitor, and systemic rival,” arguing that such a definition was inconsistent with both sides' shared commitment to open markets and rules-based trade.
• “Our emphasis should be on partnership. China has no intention of being a threat or adversary to the EU,” Yao said, commending the bloc’s multilateral stance on international relations in contrast to President Donald Trump’s more isolationist policies.

• India registered a trade deficit of $99.2 billion with China in the 2024/25 fiscal year ending in March, according to trade data, primarily due to a spike in imports of electronic items and consumer durables.
• This development coincides with U.S. President Donald Trump's recent decision to implement a 90-day freeze on most tariff increases for key trade allies, including India, while significantly raising tariffs on Chinese goods. The move has sparked concerns that Chinese manufacturers may begin redirecting their exports to other markets.
• In March alone, imports from China surged by over 25% compared to the same period last year, reaching $9.7 billion, driven largely by electronics, electric batteries, and solar cells. Over the 12 months through March, total imports from China climbed to $113.5 billion, as per detailed data released by the commerce ministry on Wednesday.

• Singapore Prime Minister Lawrence Wong said on Wednesday there was little comfort in the U.S. postponing most of its proposed "reciprocal" tariffs, saying the changes had already created great uncertainty around the world.
• Wong also said the trade war between the U.S. and China would see trading between the countries grind to a halt, and "the pain will be felt everywhere". - Reuters

• China's President Xi Jinping called for support for the international system centred around the United Nations, trade and the rule of law as he continued on a Southeast Asian tour amid a sharp deterioration in China-U.S. relations.
• Xi is in Malaysia as part of a three-nation Southeast Asian trip that includes Vietnam and Cambodia, to consolidate ties with some of China's closest neighbours as trade tensions with the United States escalate.
• In an opinion piece published by Malaysia's English language daily The Star on Tuesday, Xi said a United Nations-centred international system underpinned by international law was crucial to "promote fairer and more equitable global governance".
• "We must uphold the multilateral trading system, keep global industrial and supply chains stable, and maintain an international environment of openness and cooperation," Xi said.
• Xi's comments come after U.S. President Donald Trump, who took office in January, shocked markets by imposing sweeping tariffs on countries across the world. While some of the tariffs have since been delayed, Beijing faces 145% duties. - Reuters

U.S. President Donald Trump is reportedly crafting a sweeping global strategy to isolate China economically by offering tariff relief to countries that curb their trade ties with Beijing, The Wall Street Journal reported, citing sources familiar with the plan.

The proposed framework would involve the U.S. asking over 70 countries to stop purchasing cheap Chinese goods, refrain from re-exporting U.S. products to China, and prevent Chinese firms from using third-country registrations to dodge American tariffs.

The objective, according to the report, is to diminish China’s global trade influence and force it back to the negotiating table under less favorable terms.

Trump has openly suggested such a pivot, saying he may compel countries to choose between doing business with the U.S. or with China, a move that could redefine global trade alignments if re-elected.

In a significant boost to India’s ambitious high-speed rail project, Japan will provide two Shinkansen train sets, one each from the E5 and E3 series, free of cost for use as inspection vehicles, Japan Times reported. These trains will be deployed along the under-construction Mumbai- Ahmedabad high-speed corridor, marking a deepening of Indo-Japanese technological cooperation.

Sources familiar with the development told Japan Times that the trains would be delivered in early 2026, after being fitted with specialised inspection equipment. The move comes as both governments work to operationalise the first phase of the 508-km corridor, also known as the bullet train project, with a partial launch targeted for August 2027.

The gifted E5 and E3 train sets will serve as a temporary solution, as the next-generation E10 series Shinkansen, Japan’s latest high-speed model, is not expected to be ready for deployment in India by 2027. The Indian and Japanese governments plan to introduce the E10 series in the early 2030s.

European stock markets opened lower on Wednesday, snapping a two-day rally, as concerns around U.S. trade tariffs and weaker-than-expected earnings from a key semiconductor player dragged sentiment.

The pan-European Stoxx 600 index fell 0.8% in early trade, reversing recent gains. The downturn was led by technology stocks, particularly ASML, which saw its shares plunge 6.5% after the company missed analysts’ expectations on new orders and pointed to uncertainty related to U.S. trade policy.

ASML reported net bookings of €3.94 billion ($4.47 billion) for the first quarter of 2025, well below analyst estimates of €4.89 billion. The company flagged geopolitical and regulatory uncertainty, particularly around trade restrictions, as a key challenge to its outlook.

Industry peer ASM International also took a hit, with shares falling 4.5% in early trading.

Adding to the mixed market sentiment was data from the U.K. Office for National Statistics, which showed that inflation slowed slightly more than expected in March. The consumer price index rose 2.6% year-on-year, just below the 2.7% forecast in a Reuters poll, offering some relief but also adding to broader market caution.

(From CNBC)

Japan is set to begin in-person tariff negotiations with the United States on Wednesday, becoming one of the first nations to test Washington’s openness to easing sweeping trade duties that have shaken global markets and raised recession concerns.

Japanese chief negotiator Ryosei Akazawa will hold talks with U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, with discussions expected to cover not just tariffs but also energy cooperation and the sensitive topic of exchange rates.

While Bessent has suggested there’s a “first mover advantage” in the ongoing talks, over 75 countries have sought negotiations, Japanese Prime Minister Shigeru Ishiba has made it clear that Tokyo won’t rush into any agreement or make major concessions.

Japan is currently facing 24% levies on its exports to the U.S., though these duties have been paused for 90 days, excluding a 10% base rate and a steep 25% tariff on cars, a critical component of Japan’s export economy. So far, Japan has ruled out retaliatory measures.

In a sign of warming ties and increasing people-to-people engagement, the Chinese Embassy in India has issued over 85,000 visas to Indian citizens between January 1 and April 9, 2025.

Welcoming the surge, Chinese Ambassador Xu Feihong invited more Indians to explore the country, describing China as an “open, safe, vibrant, sincere, and friendly” destination. “We welcome more Indian friends to visit China,” Xu said in a post on X, signaling Beijing’s intent to deepen cultural and diplomatic ties with New Delhi.

The development comes even as global trade tensions escalate. US President Donald Trump recently threatened a fresh round of tariffs—particularly aimed at China. In response, Beijing has called on India to stand in solidarity against what it described as “U.S. tariff abuse.”

• The US remains India's largest trading partner for the fourth consecutive year in 2024-25, with bilateral trade valued at $131.84 billion.
• India's trade deficit with China has widened to $99.2 billion in 2024-25, up 17% from $85.07 billion in 2023-24.
• India's exports to China fell by 14.5% to $14.25 billion in 2024-25, while imports from China rose by 11.52% to $113.45 billion.
• China is India’s second-largest trading partner, with two-way commerce totaling $127.7 billion in 2024-25.
• India's trade surplus with the US has reached $41.18 billion, up from $35.32 billion in 2023-24.
• Exports to the US rose by 11.6% to $86.51 billion, while imports from the US increased by 7.44% to $45.33 billion.
• India's major exports to the US include drug formulations, telecom instruments, and precious stones.
• India’s trade with the UAE in 2024-25 amounted to $100.5 billion, making it the third-largest trading partner.
• India and the US are negotiating a trade agreement aimed at increasing bilateral trade to $500 billion by 2030.

(With inputs from PTI) 

The pharmaceutical industry is urging the Drug Controller General of India (DCGI) to relax newly introduced export regulations, which are reportedly hampering up to $3 billion in immediate exports. Sources tell CNBC-TV18 that the new guidelines are creating significant roadblocks for both existing and future contracts, as pharmaceutical companies argue that they complicate international trade.

The DCGI, however, stands by the regulations, saying that they are designed to simplify processes and align Indian export norms with the latest global standards. The regulatory body also stresses that the new guidelines aim to ensure domestic safety and uphold responsible export practices, pointing out that many importing nations , such as Yemen, Ghana, and Rwanda,lack the infrastructure to issue national regulatory approvals prior to imports.

The United Kingdom’s annual inflation rate eased to 2.6% in March, coming in slightly below analyst expectations, according to data released Wednesday by the Office for National Statistics (ONS).

Economists surveyed by Reuters had forecast a 2.7% rise in the Consumer Price Index (CPI) over the twelve months to March.

The latest figure marks a continued slowdown from February’s 2.8% and January’s 3%, suggesting that inflationary pressures may be gradually receding.

Core inflation, which strips out volatile categories like energy, food, alcohol, and tobacco, also edged lower, rising 3.4% year-on-year in March compared to 3.5% in February.

Following the data, the British pound rose 0.25% against the U.S. dollar to trade at $1.3265.

(From CNBC)

China will only return to the negotiating table on tariffs if the United States adopts a stance of mutual respect and cooperation, a former senior Chinese official has said, as tensions between the world’s two largest economies continue to escalate.

Zhu Guangyao, who served as China’s Vice Minister of Finance from 2010 to 2018, told Bloomberg News that Beijing will not entertain discussions if the Trump administration expects China to accept U.S. demands unconditionally. “There will be no talks under pressure or without respect,” he said.

Zhu’s remarks come at a time when U.S.-China trade relations have deteriorated sharply, with both sides slapping steep tariffs on each other’s goods. U.S. tariffs on Chinese imports have soared to at least 145%, while China has responded with levies of up to 125% on American exports.

Gold prices soared to a record high in the domestic futures market on Wednesday, April 16, 2025, buoyed by a weakening dollar and mounting concerns over the global tariff war. The June 5 gold contract on the Multi Commodity Exchange (MCX) opened at Rs 94,573 per 10 grams, up Rs 1,122 from its previous close of Rs 93,451. It later surged further to touch an all-time high of Rs 94,900 per 10 grams.

Gold on MCX at a record high, crosses Rs 94,900/10 gm

IndusInd Bank could be heading for a major leadership shake-up after a disclosure of significant irregularities in its derivatives portfolio, sources told CNBC-TV18.

At least three senior executives may exit in the coming months, including CEO Sumant Kathpalia and Deputy CEO Arun Khurana, who oversees global markets, including the troubled derivatives segment, a person directly involved in the matter said.

The bank’s board has already initiated succession planning, especially after the Reserve Bank of India extended Kathpalia’s term by just one year. People familiar with the development say the RBI has asked the board to prepare a shortlist of CEO successors at least four to six months ahead of his March 2026 term-end.

Dutch semiconductor equipment maker ASML on Wednesday fell short of net bookings expectations for the first quarter of 2025, hinting at a possible cooling in demand for its chipmaking machinery.

The company reported net bookings of €3.94 billion ($4.47 billion), significantly below the €4.89 billion forecast by Reuters. The shortfall suggests some softness in orders for its high-end lithography systems, which are critical to global chip production.

Here’s how ASML performed against LSEG consensus estimates:

Net sales: €7.74 billion vs. €7.8 billion expected

Net profit: €2.36 billion vs. €2.3 billion expected

Despite the bookings miss, ASML CEO Christophe Fouquet said the overall demand outlook "remains strong," driven by continued momentum in artificial intelligence. However, he cautioned that "uncertainty with some of our customers" may push full-year revenue toward the lower end of its €30 billion to €35 billion guidance range.

(From CNBC)

Japan’s Fair Trade Commission (JFTC) on Tuesday issued a cease and desist order against Google, accusing the tech giant of engaging in unfair trade practices related to its search services on Android devices. The move brings Japan in line with similar antitrust actions taken by regulators in the United States and the United Kingdom.

In its statement, the JFTC said Google violated Japan’s anti-monopoly laws by using licensing agreements to force Android device manufacturers to prioritize its own search applications. These agreements required companies to preinstall and prominently display Google Search and Chrome on their smartphones and tablets.

While Google owns and develops the Android operating system, the actual devices are produced by third-party manufacturers such as Samsung and Lenovo. These firms must enter into licensing deals with Google to preinstall core services like the Google Play Store.

According to the JFTC, at least six such licensing arrangements were active as of December 2024, raising concerns over how Google leveraged its market power to cement the dominance of its search and browser services on Android platforms.

(From CNBC)

India’s $10 billion pharmaceutical exports to the United States may face fresh headwinds as Washington launches a probe into the national security risks of relying on imported medicines and ingredients. The investigation, initiated by the US Commerce Department on April 14, will examine whether foreign pharmaceutical supply chains could threaten the country’s healthcare resilience.

India is among the top five drug suppliers to the US, alongside countries like Ireland, Germany, and Switzerland. From 2015 to 2023, India’s share of US pharma imports nearly doubled, rising from 6% to 11%. Meanwhile, European nations have maintained or grown their dominance, with Ireland now accounting for 28% of US imports and Germany 21%, according to Nuvama data.

Asia-Pacific markets mostly traded lower on Wednesday, following Wall Street’s overnight decline as investors weighed quarterly earnings and ongoing tariff concerns. Hong Kong’s Hang Seng Index fell 2.11%, and Mainland China’s CSI 300 dropped 0.84%.

Despite China’s economy expanding 5.4% in the first quarter—surpassing expectations—tariff threats from the U.S. continue to put a damper on investor sentiment. While Reuters economists had predicted a 5.1% year-on-year growth, UBS revised its GDP forecast for China, downgrading it to 3.4% for 2025 and 3% for the following year. UBS’s chief China economist, Tao Wang, estimates that U.S. tariff hikes could reduce China’s GDP growth by over 2 percentage points.

China’s crude steel production increased in March, driven by a surge in exports and lower raw material costs, which boosted margins. Mills produced nearly 93 million tons, a 4.6% rise from last year.

This pushed first-quarter production up 0.6%, totaling over 259 million tons. The result is likely to disappoint the government, which had pledged to address the nation’s steel glut by reducing output.

(From Bloomberg)

ICICI Bank has reduced its savings account deposit interest rate by 0.25%, following a similar move by larger rival HDFC Bank. The new rates, effective Wednesday, offer a 2.75% interest on savings balances up to Rs 50 lakh, aligning with HDFC Bank's offering. For balances over Rs 50 lakh, the rate has been cut to 3.25%.

The move comes after the RBI’s consecutive rate cuts, which have pressured banks to lower their deposit offerings. State Bank of India (SBI), the country’s largest lender, currently offers 2.70% interest on savings deposits.

The ongoing rate reductions reflect the RBI’s push for faster transmission of its rate cuts to support economic growth, as banks face challenges in deposit growth and margin pressures.

The Steel Ministry Secretary stated that the majority of the increase in steel imports is from Japan, not China. He added that, given the current US-China tariff situation, a significant rise in steel imports is unlikely. While safeguard duty is being considered, the ministry is also focusing on the abuse of import licenses as part of its strategy.

(From CNBC-TV18)

China’s President Xi Jinping landed in Malaysia on Tuesday evening, kicking off a Southeast Asian tour aimed at sending a powerful message: Beijing is a more dependable trading partner than the United States, especially amid a bruising trade war with Washington.

This marks Xi’s first visit to Malaysia since 2013, following a successful trip to Vietnam, where he sealed multiple trade deals spanning artificial intelligence and rail development.

On arrival, Xi underscored the importance of “deepening high-level strategic cooperation,” which he believes benefits both nations and promotes regional and global stability, as reported by Malaysia's Bernama news agency.

Xi’s visit, which includes stops in Malaysia, Thailand, and Cambodia, comes at a time when many ASEAN nations are increasingly frustrated by the US’s trade tactics, particularly the heavy tariffs imposed under President Trump.

The Steel Ministry Secretary has said the government is examining the Directorate General of Trade Remedies' (DGTR) recommendation on safeguard duty. A decision is expected soon.

He clarified that the safeguard duty process is quasi-judicial in nature, making it difficult to comment on whether the rate will be revised from the current 12% to 20%.

The official also dismissed speculation of a steep hike, saying there is no merit in rumours suggesting the duty will be raised to 20%.

(From CNBC-TV18)

As part of a broader reshuffle, China has also removed Wang Zhizhong, head of the National Immigration Administration, and Vice Foreign Minister Chen Xiaodong from their posts.

(From CNBC)

China has appointed Li Chenggang as the new vice minister of commerce and top representative for international trade negotiations, replacing Wang Shouwen, according to an official statement released Wednesday. The shake-up comes as trade talks with Washington remain at a standstill.

(From CNBC)

Greenwoods Asset Management Ltd., a $20 billion Chinese hedge fund, has ramped up its investment in Hong Kong stocks following last week’s market dip, confident that Beijing’s policy support will propel a rebound and attract global investors increasingly wary of U.S. markets.

Gao Yuncheng, managing director at the firm, said Greenwoods has exited nearly all of its non-Chinese positions this year. The shift reflects growing faith in China’s consistent policy approach, especially as U.S. President Donald Trump escalates trade tensions globally.

“In a volatile market, the key is policy stability and rationality,” Gao said in an interview from Shanghai on Monday. “Unlike the U.S., where trade policy keeps changing, China has remained supportive—particularly since September.”

(From Bloomberg)

Hong Kong Post, the postal service in the semi-autonomous Chinese city, announced it will stop handling packages sent to or from the United States in response to the latest escalation in the trade war, according to CNN.

The decision follows U.S. President Donald Trump's move last week to eliminate the “de minimis” exception for postal items shipped from Hong Kong to the U.S. Under the new rules, packages valued under $800, which were previously exempt from tariffs, will now face steep increases in fees.

Hong Kong’s government expressed strong disapproval, calling the U.S. actions “unreasonable” and accusing the U.S. of bullying and imposing tariffs abusively. It warned that the public should brace for “exorbitant and unreasonable fees” due to these changes.

Starting immediately, Hong Kong Post will cease accepting packages transported by sea, with air-borne shipments stopping on April 27. This comes after Trump signed an executive order in early April to triple tariffs on goods under $800 sent from China, including Hong Kong.

Originally set for a 30% tariff increase on May 2, the new executive order raises that rate to 120% per package, adding up to $200 in fees, which will likely impact consumers ordering from platforms like Shein, Temu, and AliExpress.

Oil was slightly higher:

• Brent crude rose 0.2% to $64.79/barrel.
• U.S. crude also gained 0.2%, trading at $61.42/barrel.

The U.S. dollar remained under pressure.

• Euro rose 0.3% to $1.1316.
• Yen edged up 0.3% to 142.84 per dollar.
• Bank of Japan Governor Kazuo Ueda hinted at a possible pause in rate hikes if U.S. tariffs hurt Japan’s economy.

U.S. Treasury yields held firm

• 10-year yield was steady at 4.325% (well below last week’s high of 4.592%).
• 30-year yield remained flat at 4.777%.

Gold prices continued their upward streak, hitting a fresh record high of $3,266.65 an ounce, up 1.2%. ANZ now expects gold to reach $3,600 by year-end, saying the current rally hasn't fully priced in “risk-off” sentiment.

MSCI’s Asia-Pacific index (ex-Japan) dropped 0.9%, ending a four-day rally.

• Japan’s Nikkei slid 0.5%.
• Hong Kong’s Hang Seng dropped 1.6%, while Chinese blue chips fell 0.6%.
• Interestingly, Chinese chipmakers rose: Hua Hong Semi gained 4%, and SMIC rose 1%.

Asian shares fell on Wednesday as U.S. chipmaker Nvidia lost ground following new American restrictions on chip sales to China. The move raised fears of a deepening U.S.-China tech and trade war. Nvidia’s stock dropped 6% in after-hours trading, wiping out $160 billion in market value. The company revealed it could face $5.5 billion in charges due to U.S. curbs on its H20 AI chip exports to China, one of its top markets.

U.S. President Donald Trump has ordered a probe into possible new tariffs on all critical mineral imports. Reviews are already underway for pharmaceutical and semiconductor imports. Markets now await a key speech by U.S. Fed Chair Jerome Powell later today. Fed Governor Christopher Waller has already struck a dovish tone, and Powell is expected to follow suit.

Former President Barack Obama has condemned the Trump administration's freezing of $2.3 billion in funding to Harvard University as unlawful and “ham-handed.” The freeze affects more than $2.2 billion in grants and $60 million in contracts after the university refused to comply with the administration’s demands for changes to its leadership, governance, and admissions policies. Harvard has vowed to uphold its independence and constitutional rights.

In an unusual move, President Donald Trump is exploring the possibility of deporting US citizens to prisons in Central American countries. The White House confirmed that this is a legal question the President is currently investigating. If legally feasible, it would apply only to Americans considered to be the most violent and egregious offenders.

China’s economy expanded by 5.4% in the first quarter of 2025, surpassing economists' expectations of a 5.1% growth, despite ongoing tariff threats. Retail sales in March rose by 5.9%, outpacing analysts' expectations of 4.2%, while industrial output grew by 7.7%, well above the forecasted 5.8%. This growth comes amid a broader recovery fueled by policy stimulus measures.

South Korean Finance Minister Choi Sang-mok is set to meet with US Treasury Secretary Scott Bessent next week to discuss trade issues during a visit to the United States. The discussions are expected to focus on tariff reductions, particularly the 25% reciprocal tariff imposed by President Donald Trump on South Korea, which has been paused along with other high tariffs on multiple countries.

The yen is steady at 142.85 per dollar, while the Swiss franc remains firm at 0.8184 per dollar. The Australian and New Zealand dollars, after making large gains last week, are slightly off recent highs. Attention is on the yuan, with China having weakened its trading band slightly amidst ongoing tariff threats. The US Treasury market, which faced near-panic selling last week, is showing signs of steadying, and traders are watching for signs that the strong correlation between yields and the dollar may return.

The local Canadian dollar remains firm at C$1.3948 per greenback, up 4% in April, reflecting how heavily investors have punished the US dollar amidst fluctuating trade policies. The euro, which hit three-year highs last week, has eased from its peak of $1.1474 to $1.1311 in the Asia morning session, up more than 4.5% this month. Meanwhile, the British pound has gained, reaching a six-month high at $1.3254, amid expectations of a trade deal between the US and the UK.

The US dollar is holding onto a small bounce, as investors take a breather after weeks of heavy selling. Markets are stabilizing as they await further developments in U.S. trade talks. The focus now shifts to China’s first-quarter GDP data and a batch of economic indicators, as well as comments from U.S. Federal Reserve Chairman Jerome Powell, scheduled for later in the day.

Asian markets opened with modest losses, while Treasury yields have cooled off. However, gold prices hit a new record high this morning. The benchmark indices traded higher for much of Tuesday's session, but the Dow ended 150 points lower after falling 400 points from its highs. The S&P 500 and Nasdaq also closed in the red.

Markets across Asia opened in the red this morning, weighed down by renewed global uncertainties—from record-high gold prices and cooling US Treasury yields to Trump’s tariff threats and China’s better-than-expected Q1 GDP data. As the world reacts to shifting trade policies and a flurry of economic signals, investors are keeping a close eye on upcoming Fed commentary, currency movements, and key Q4 earnings reports like Wipro’s.