According to sources familiar with the matter, Chinese lawmakers are reportedly set to convene a high-level emergency meeting on Wednesday in response to a supposed trade standoff with the United States. The discussions are expected to focus on a package of economic support legislation to improve domestic consumption and stabilize volatile capital markets.

The anonymous sources claimed the meeting would bring together senior officials from the State Council, the People’s Bank of China, and other regulatory bodies. On Wednesday, the US took the duties on Chinese imports to 104%, almost double the rate initially set for the Asian country. 

Tariff hikes are offensive to the Chinese government 

According to Reuters, the gathering will be the first publicly known high-level response from Chinese policymakers since President Trump announced the US tariff hikes on April 2. 

Sources say representatives from the Ministry of Commerce, the Ministry of Finance, the China Securities Regulatory Commission (CSRC), and the National Financial Regulatory Administration (NFRA) are expected to attend the closed-door session.

The State Council Information Office and the involved agencies have not responded to media requests for comment. Still, insiders asserted that the focus would be on measures that could be implemented in the short term to support domestic economic activity, with several options on the table, including improved export tax rebates and increased consumer subsidies.

Analysts believe China’s leadership is pressured to answer investors and the public’s queries about having the necessities to manage the fallout from Washington’s “war-like” trade policies.

Trade war hits China during fragile economic times

While fighting US tariffs, China is already grappling with a prolonged property sector downturn and ballooning local government debt, which has sapped business confidence and weakened household spending.

Economists warn that the trade conflict could knock as much as two percentage points off China’s GDP growth this year. Sluggish demand for goods, industrial overcapacity, and growing deflationary pressure puts the world’s second-largest economy on unstable footing.

Even with the 34% counter-tariffs measured towards the US, as revealed last Friday, Beijing is arguably on the defensive. Trump’s trade strategy is to try isolating China from the global trading system, pushing taxes on Chinese exports, together with countries and firms involved in the assembly or resale of Chinese goods.

Premier Li Qiang on Tuesday insisted China is “fully capable of hedging against adverse external influences.” Still, market watchers believe the scale of the challenge will limit what monetary and fiscal policy alone can achieve. 

Although China ran a trillion-dollar trade surplus last year, this cushion may not be enough to offset collapsing global demand when the tariff dispute pulls down economic tailwinds by the hour.

“There is no sector of the economy that could even remotely survive 104% tariffs on China, btw,” propounded one stock market trader on X.

At a press conference earlier today, China’s Foreign Ministry spokesperson, Lin Jian, said Chinese people’s “legitimate right to development must not be deprived” through punitive tariffs on Chinese goods.

Lin accused the United States of engaging in “bullying practices” and asked the Trump administration to exercise “equality, mutual respect, and reciprocity” in resolving the trade mishap through dialogue.

“If the US insists on provoking a trade war. China will be compelled to fight to the end,” Lin concluded.

Stocks are still in a bloodbath, everywhere 

Over to financial markets, Chinese blue-chip stocks have erased all gains for the year, with the CSI300 Index plunging over 5% since April 2, the day Trump announced an additional 34% tariff on Chinese goods. The Hang Seng Index in Hong Kong has fared even worse, tumbling 12.5% over the same period.

However, hours before Wednesday’s US market opened, Chinese stocks had recovered some ground, following the government’s retaliatory 84% tariff on US goods. The offshore yuan also strengthened to approximately 7.38 against the US dollar, snapping a three-day losing streak supported by a weaker greenback.

Talks of officials’ interest in domestic tech companies and state pledges to backstop the markets gave a modest boost to investor sentiment.

Chinese state media are expected to report portions of the upcoming meeting’s agenda to reassure markets of policymakers’ unity. According to local news outlets, some measures discussed could be rolled out in the coming weeks, but no definitive timetable has been disclosed.

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