Tag Archives: US China trade tension

Although highly uncertain, any truce between the US and China at the G20 meeting could delay new tariffs.A new low point in trade tensions between the US and China was reached in September 2018 when the US placed an additional 10% duty on roughly USD200 billion of Chinese imports. However, since then, hints at a potential ‘détente’ have focused on the G20 summit in Buenos Aires at the end of November, with hopes that progress there could delay the setting of tariffs on all Chinese imports...

Structural changes may lead to the first current account deficit in over two decades this year.Over the first three quarters of this year, China ran a current account deficit of USD12.8 billion. It looks likely that China will see its first full-year current account deficit in over two decades in 2018.We believe that China’s current account position is going through structural change, driven by two trends. The first is the decline in China’s merchandise trade surplus. Indeed, since reaching...

As the US vies to maintain world leadership beyond commerce, its policies will continue to create waves for markets.Today we are witnessing a redefinition of international relations and a new, although likely unstable, global equilibrium. The trade dispute unfolding today between the US and China should be seen in light of shifting structural trends that have developed over the last few decades. We expect rationality will eventually prevail, but the outlook is muddled by the Trump...

China’s latest retaliatory measures seem fairly restrained, but the tension between the two nations could drag on for quite some time.On 3 August, the Chinese government announced a list of additional tariffs on USD 60 billion worth of US imports in retaliation to the US’s proposed tariffs on USD 200 billion of Chinese goods. When these tariffs are implemented will depend on when the US activates its tariffs. The announcement came shortly after President Trump stated that he was considering...

The likelihood of tariffs has increased. Although there is still room for negotiation, the process could be long and bumpy.A US delegation of Trump’s top economic advisors, led by Treasury Secretary Steven Mnuchin, had a two-day meeting with their Chinese counterparts in Beijing on 3-4 May to discuss the trade issues between the two nations. It appears that the meeting has led to little progress in solving the trade disputes between the two, meaning the trade tensions may persist for quite...

While our central scenario remains unchanged, we still see downside risks increasing from recent trade escalation.Following on from President Trump’s announcement of a 25% tariff on USD50bn of unspecified imports from China, the US Trade Representative (USTR) last week detailed the list of China-made goods that will be targeted. China reacted swiftly by detailing its own list of counter-tariffs on USD50bn worth of imports from the US. Trump then escalated the rhetoric further when he...