Will the ceasefire change the game?

3 December, 2018

Appetite towards investors taking on risk, including stocks and emerging markets should be in line for a lift higher as trading resumes after both China and the United States agreed to suspend new trade tariffs during their meeting following the G-20.

It will still be important for investors to stay very close to this development and also not get too carried away. The mutual agreement to not raise trade tariffs further is essentially a ceasefire until the new year and indicates that negotiations will remain ongoing over the interim, it doesn’t reverse the tariffs and tensions that have dominated global market sentiment throughout the majority of this year.

Emerging market assets like the Chinese Yuan might benefit over the interim from the headline that trade tariffs will not get any worse for a while, but investors essentially need guidance that there is an eventual end-game to these prolonged tensions to go “all in” on increased risk appetite.


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