China just fired back in the ongoing trade tussle with the US, announcing new tariffs on American goods like crude oil, agricultural machinery, and liquefied natural gas. The move comes as a direct response to the Trump administration’s decision to slap a 10% tariff on Chinese imports.

Starting February 10, these new duties will hit certain US products with taxes ranging from 10% to 15%. China’s Ministry of Finance also introduced export controls on key materials like tungsten and tellurium, which are crucial for industries like defense and solar energy. Two American companies, Illumina and PVH Group (the folks behind Calvin Klein and Tommy Hilfiger), were added to China’s “unreliable entities” list for allegedly breaking market rules. PVH expressed disappointment but vowed to work with Chinese authorities to clear things up.

Meanwhile, China’s State Administration for Market Regulation launched an investigation into Google for potential anti-monopoly violations, despite the tech giant’s limited presence in the country.

This tit-for-tat escalation follows the US’s broad 10% tariff on Chinese imports, which took effect over the weekend. Experts note that China’s retaliatory measures are relatively modest compared to the US actions, targeting around $20 billion of US imports—just 12% of the total trade between the two countries.

Beijing has also filed a complaint with the World Trade Organization, accusing the US of undermining global trade rules. Despite the rising tensions, both sides seem open to further dialogue. President Trump hinted at a potential call with Chinese leader Xi Jinping, though Beijing hasn’t confirmed it yet.

As the trade war heats up, markets across Asia responded positively, with Hong Kong’s Hang Seng Index rising 2.8%. However, the Shanghai stock index remained closed for the Lunar New Year holiday.

This latest chapter in US-China trade relations could set the tone for their economic future, with both nations navigating a host of issues like the fentanyl trade, tech rivalry, and a massive trade deficit. While the current tariffs are a far cry from Trump’s earlier threats of 60% duties, they signal that tensions are far from over.

Stay tuned as this story unfolds.