Beijing has a powerful tool for responding to President-elect Donald Trump's threatened new tariffs on Chinese goods: It could start a currency war, a step that poses formidable risks for China as well as the United States,

Stock markets fell and the dollar rallied Tuesday after Donald Trump warned he would impose huge new tariffs on China, Mexico and Canada on his first day in office, dealing a blow to hopes of a more moderate approach to trade policy.

A spokesperson at the Chinese Embassy in Washington said his country is fighting fentanyl trafficking, the reason for the new promised penalty.

While China could offset American tariffs by letting its currency fall, that might endanger Beijing’s recent efforts to stabilize the economy.

President-elect of the United States, Donald Trump, has announced plans to impose a 10% tariff on all imports from China. He attributed this move to the "influx of illegal drugs, including fentanyl and other substances,

China reacts to Trump’s tariff threat, saying it is open to dialogue with the US Also on East Asia Tonight (Nov 26), Singapore's Lee Hsien Loong highlights the importance of cooperation as he meets China's Xi Jinping in Beijing;