Zoe Callow China has moved from publicly rejecting Washington's ultimatum on Iran trade to explicitly warning it could retaliate, according to Financial Times' FirstFT briefing.
Earlier coverage detailed Beijing's rejection of what Washington called an 'economic D-Day' ultimatum, with China vowing not to bow to US 'economic warfare.'
The escalation follows Treasury Secretary Scott Bessent unveiling a sanctions package described as unprecedented, targeting 60 entities tied to Iran's economy, according to The Washington Post. Iran has vowed to retaliate against the widened sanctions while saying Washington is also seeking talks, per Reuters.
A Chinese retaliation threat would turn a US-Iran sanctions dispute into a direct US-China confrontation, adding friction to an already fragile bilateral trade truce.
China still relies heavily on dollar-denominated trade but has been building financial hedges against future US sanctions, according to CNBC. What retaliation Beijing actually deploys — and whether it stops short of touching that dollar dependence — is the question to watch.
