Trump raises stakes in the trade war

1 August, 2018

Two opposite trends prevail in the global markets. Strong reporting of companies, including Apple indicators supports the demand in world markets. However, the Chinese bourses falls under the pressure on the news that Trump is considering 25% tariffs on Chinese goods worth $200 billion against 10% that are being discussed now.

The news about tariffs for China appeared shortly before the start of the negotiations round between the major world economies. We saw a similar move before Juncker and Trump meeting last week. The goods in the amount of $200 bln represent almost the half of U.S. imports from China and about 10% of total U.S. imports per year. 25% of tariffs can add to inflation more than 1.2 percentage points and seriously harm the established business practice in the USA.
Since July 1, the States have introduced duties for goods worth $34 bln and China responded in tit-for-tat manner.

It is also interesting how China intends to respond to the expansion of duties up to $200 billion. The U.S. exports goods to China amounting to $130 bln, so it is unlikely that it will be able to respond with a proportionate expansion.

It is quite possible that the US-China rates are so high that the negotiations are simply bound to move into a more constructive direction.


Source link  
Market shows demand for yielding assets

The market shows demand for yielding assets, which in turn supports demand for the stocks and currencies of emerging markets. The main...

Yuan and Dollar as a weapon in trade wars

The US Nonfarm Payrolls on Friday could even be called boring: the report showed the preservation of a completely healthy labour market...

Disappointment with Fed and tariffs

Trump announced 10% tariffs on Chinese goods worth $300 billion since September 1, thus ending the US-China trade truce after disappointingly...


Fed pushes down stocks

Markets have started the week under pressure. Expectations that the Federal Reserve will cut interest rates by 50 points in July collapsed...

Gold updates new 6-years highs

Gold benefits from a combination of two factors: lower interest rates in debt markets and continuing hopes that the global economy...

Markets recede from the recent highs

A strong Nonfarm Payrolls caused pressure on the stock markets, reducing the chances of the interest rates lowering by the Fed in the upcoming months...


Gold resumes rally, pushing past $1400

Gold prices resumed a push higher on Monday, as flows into the precious metal continued on improved prospects for easier monetary policy from...

Gold rises as markets slip

Market caution continues to support gold. Quotes of this metal rose to $1337, repeatedly trying to push above this year highs at the 1340-1360 area...

Trump says Brexit should happen

President Donald Trump promised the U.K. a "phenomenal trade deal" Tuesday, on the second day of his state visit to Britain...

  


Share it on:   or