Huawei Technologies’ dollar bonds are plunging as U.S. and other companies begin adhering to Washington’s latest sanctions and stop conducting transactions with the Chinese telecom equipment maker.

The price fall comes as investors become fearful that Washington’s next move might be to impose financial restrictions on the company.

An analyst at a major think tank said U.S.-China relations “have entered a stage where neither side can back down.”

Huawei has issued dollar-denominated bonds four times. The bonds have maturity dates from 2022 to 2027, and their combined outstanding balance is around $4.5 billion. The issues’ lead managers include major global investment banks, including the U.K.’s HSBC and Standard Chartered, Deutsche Bank, Citigroup of the U.S. and Hong Kong’s Bank of China.

According to QUICK FactSet, Friday’s price, the most recent available on the service, for a 10-year Huawei bond with a coupon rate of 4.215% and a May 2026 maturity was $954.10. That is down 2.4% from the previous business day and marks the price’s steepest daily decline since the $1,000 bond was issued.

The yield was at about 4.9%.

The U.S. Department of Commerce on Thursday officially added Huawei to its Entity List of foreign companies deemed to pose a security threat. American companies are banned from trading with these “entities,” which means Huawei is barred from buying U.S.-made components, software and other technologies.

“This decision is in no one’s interest,” Huawei said in a release on Friday.

Shinichi Seki, a Japan Research Institute analyst, said Washington’s next move could be placing financial sanctions on Huawei. If Huawei, like Iran and North Korea before it, is banned from conducting transactions in dollars, the technology company would suffer a significant blow, Seki said.

And since Huawei is a symbol of Beijing’s Made in China 2025 initiative, the country’s economic growth could be hindered.

The total outstanding balance of Huawei’s dollar-denominated bonds is minuscule relative to the company’s net worth of about $34 billion. And the unit price of the aforementioned issue remains relatively high compared to its low of about $890 that it plumbed in December.

However, investors remember when Huawei’s debts last year swelled about 30% as U.S.-China relations deteriorated. Since then, the market has grown more anxious about where the two countries’ battle for economic hegemony might be headed.

Feds Evans is the President of the Chicago Fed and is a voting member in 2019

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