White House says tariff review on China is underway

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White House says tariff review on China is underway

The Biden administration is studying the inflationary impact of tariffs imposed on China by former President Donald Trump's administration, given a surge in consumer prices, according to Jen Psaki, White House press secretary.

Psaki said she had no news on tariff reductions, since U.S Trade Representative Katherine Tai is still reviewing Trump-era tariffs on Chinese goods. She made clear that higher inflation was a factor in the deliberations.

She said the review was looking at larger issues, such as China's behavior in global markets, and the impact of tariffs on wages, job opportunities and America's competitive edge.

The White House comments came after U.S. Treasury Secretary Janet Yellen said it was worth considering taking steps to lower U.S. tariffs on Chinese goods, given the desirable effects such a move could have on lowering U.S. inflation, which has hit 40 year highs this year.

Deputy national security adviser Daleep Singh said on Thursday that easing tariffs on non-strategic Chinese goods such as bicycles or clothing could help combat inflation.

Biden's approval ratings have fallen because of the cost of energy, food and other staples, with mounting public frustration threatening to cost Democrats their slim majority in Congress in the midterm elections in November.

Chad Bown, a senior fellow at the Peterson Institute for International Economics, said Psaki's comments compounded expectations that the Biden administration was considering tariff reductions.

Bown said that would likely require behind-the-scenes negotiations with Beijing. Such a move would cause tensions with the Biden administration's push to move supply chains from China to home.