Asian stocks continued to fall in morning trade on Thursday amid fresh trade concerns. Meanwhile, the Federal Reserve concluded a two-day monetary policy meeting and left interest rate unchanged, as expected.
Higher U.S. tariffs on Chinese imports now look increasingly likely after U.S. Trade Representative Robert Lighthizer said President Donald Trump directed the increase to a higher 25% tariff on $200 billion worth of Chinese goods because China refused to meet U.S. demands.
"The increase in the possible rate of the additional duty is intended to provide the administration with additional options to encourage China to change its harmful policies and behavior and adopt policies that will lead to fairer markets and prosperity for all of our citizens," Lighthizer said in a statement.
Trump previously said U.S. could eventually impose tariffs on all U.S. imports from China.
Meanwhile, the Fed left interest rates unchanged following a two-day policy meeting, as widely expected. The central bank then upgraded its view on the economy.
The committee said it expects that “further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the committee’s symmetric 2 percent objective,”
In Asia, the Shanghai Composite and the Shenzhen Component fell 1.4% and 1.6. Hong Kong’s Hang Seng Index was also down 1.4%.
China accused the U.S. of blackmailing amid reports of higher tariffs and said it would hit back if further steps hindering trade were taken.
"U.S. pressure and blackmail won't have an effect. If the United States takes further escalatory steps, China will inevitably take countermeasures and we will resolutely protect our legitimate rights," Chinese Foreign Ministry spokesman Geng Shuang told a regular news briefing.
Japan’s Nikkei 225 slipped 0.4%.
Down under, Australia’s S&P/ASX 200 traded 0.3% lower. Major mining companies underperformed after Rio Tinto Ltd (AX:RIO) reported lower-than-expected first half profit. The company also announced plans to buy back an additional $1 billion in shares.