Weekly financial and economic analysis
President Trump imposed customs duties on China, but postponed them to the EU. US President Donald Trump signed a memorandum imposing penal duties on Chinese imports that could reach $60 billion. The reason is a violation of the rights of American intellectual property and technology. At the same time, the White House announced that it would suspend US import duties on steel and aluminum for the EU, as well as Argentina, Australia, Brazil, Canada, Mexico and South Korea. Tariffs have been suspended until May 1st, and discussions continue.
Naturally, China signals that it is not afraid of a trade war with the US and announced plans to respond to US import duties worth $3 billion as a first response to Trump’s duty decree on Chinese steel and aluminium. Beijing responds with duties in areas that are unlikely to have inflationary consequences in the Asian country. At this stage, China is signaling that it is ready for negotiations and that it does not want to come to a trade war with the United States. In addition to relying on dialogue, the Underworld Empire will try to take measures to the WTO. One of the last and many extreme moves would have been a possible refusal to purchase the U.S. SEC and a reduction in the power of the yuan.
Are there any winners from the trade wars?!
Apparently the biggest loser will be the Client who will have to pay more for his goods and services and most likely at the expense of quality. If there are fewer losers or countries that can afford the consequences of protectionism, it is the ones whose market is most attractive and desirable. What’s interesting is that these are the kind of countries that have faced each other.
The threat of a global trade war that has seriously attracted investors’ attention also brings concerns to the Federal Reserve.
At his first press conference as President of the US Central Bank, Jerome Powell said the battle around tariffs has not affected central bankers’ forecasts of the US economic prospects, but future expectations will depend on how the situation develops.
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