China retaliates, risking further tariff escalation

After initially promising unspecified "countermeasures", the Chinese authorities have now fleshed out their retaliation to the Trump administration's 10% tariff hike on all US imports from China. The measures are fairly modest, at least relative to US moves, and have clearly been calibrated to try to send a message to the US (and domestic audiences) without inflicting too much damage. But there is a risk that retaliation backfires by encouraging Trump to escalate tariffs further.