A high-stakes showdown over trade is taking shape between the world’s two largest economies. China is ratcheting up duties on American imports to 125 percent. The move comes in response to U.S. President Donald Trump’s latest reciprocal tariffs of 145 percent on Chinese imports.

How will this impact the economy in the United States and around the world? U.S. tariffs are also being imposed on other countries, though at much lower rates. Where is all this leading?