US President Donald Trump’s steep tariffs on dozens of countries, including over 100 percent on Chinese goods, went into effect Wednesday, intensifying the global trade war and sending markets into a tailspin.

Following the 10 percent tariffs that took effect over the weekend, rates on imports from major economies such as the European Union and Japan rose to 12.01 am local time on Wednesday (0401 GMT).

China, Washington's top economic rival, is the hardest hit, with tariffs on Chinese goods now reaching a staggering 104 percent. Trump claimed his policy would revive America’s manufacturing base by encouraging companies to relocate to the US, but experts warn of higher inflation as tariffs push up prices.

Trump's trade officials are also pursuing "tailored deals" with allies like Japan and South Korea, while countries such as Argentina, Vietnam, and Israel have offered to reduce their tariffs.

Meanwhile, Beijing remains defiant, vowing to fight the trade war “to the end” and preparing retaliatory tariffs on US goods. China’s 34 percent tariffs are set to take effect on Thursday at 12:01 am local time (1601 GMT Wednesday).

Trump said Tuesday that the US is “taking in almost $2 billion a day” from tariffs, and later indicated new tariffs on pharmaceuticals would be announced soon. Canada’s tariffs on certain US auto imports also began Wednesday.

Markets struggle

Stock markets across Asia plunged on Wednesday, with Hong Kong dropping more than 3 percent and Japan’s Nikkei sinking 2.7 percent. Taiwan stocks fell 5.8 percent in the afternoon, and European stock futures indicated steep declines ahead.

In foreign exchange markets, the South Korean won hit its lowest point against the dollar since 2009, and China’s offshore yuan also fell to an all-time low. Analysts warn that China's efforts to gradually weaken the yuan won’t offset the blow from the full-scale tariff barrage.

Oil prices also slumped, with West Texas Intermediate closing below $60 for the first time since April 2021.

Global trade tensions continue

The European Union has called for a de-escalation of the trade conflict, with EU chief Ursula von der Leyen stressing the need for stability. China’s Premier Li Qiang assured that China could weather the storm, confident in its sustained economic development.

Meanwhile, the EU plans its own response to US tariffs, with up to 25 percent levies on American goods such as soybeans and motorcycles. Tensions also flared in the US, with Tesla CEO Elon Musk criticizing senior White House trade advisor Peter Navarro for dismissing his company’s production efforts.

The global trade war shows no signs of abating, with increasing tariffs and retaliations putting pressure on economies and financial markets worldwide.