China announced it will raise tariffs on all US goods to 125% starting April 12, escalating its response to Washington’s earlier decision to lift tariffs on Chinese imports to 145%. The move, confirmed by the Ministry of Finance on Friday, marks a significant intensification of the trade dispute but also hints that tensions may have peaked.

In a notable shift in tone, China stated it will not respond to any further tariff increases by the US, calling such measures economically meaningless. “Given that there is no longer any possibility of market acceptance for US goods… the Chinese side will pay no attention to it,” the ministry said, suggesting that the tariff battle may have reached its limit.

Markets reacted swiftly to the news. S&P 500 futures dropped, Hong Kong stocks pared gains, and the US dollar extended losses. However, the lack of threats from Beijing beyond this latest round of tariffs has led some observers to speculate that a turning point may be approaching. By drawing a line under further retaliation, China may be signaling openness to dialogue and a potential path toward de-escalation.

Though the tariff levels are now at historic highs, the underlying message from Beijing appears less confrontational and more strategic. With both sides facing rising economic costs and diminishing benefits from continued escalation, this could mark the beginning of a shift from conflict to negotiation.