Donald Trump willing to slap tariffs on all Chinese imports

Andrew Cummings
July 23, 2018

The Chinese yuan weakness achieved through higher United States dollar-Chinese yuan fixings, while consistent with the People's Bank of China's (PBoC) easing bias, remains an unlikely retaliatory tool given the ongoing risk of capital outflow, in our view.

In the last two decades, bilateral trade between Nigeria and China has grown rapidly, rising from $2.8 billion in 2005 to $14.9 billion in 2015, which is a 430% increase.

He said: "China, the European Union and others have been manipulating their currencies and interest rates lower, while the USA is raising rates while the dollars gets stronger and stronger with each passing day - taking away our big competitive edge".

The trio think increasing tariffs on United States imports so they raise an equal amount of revenue as those placed on Chinese imports is unlikely, acknowledging this would mean "reordering of supply chains which would impose additional costs on the Chinese economy" and "negatively affect China's image as an economy that is opening up and reforming".

The Chinese textile suppliers who claim they were hired to manufacture the Trump themed hats and flags have complained that the delays at customs are negatively impacting their sales. But it's something investors will have to think about.


"I'm not doing this for politics", Trump said in an interview with CNBC. "This is one more item that just creates noise in markets".

Europe's bond yields climbed after a Reuters report that the BoJ was discussing modifying its huge easing programme sent Japan's 10-year bond yield to a six-month high.

Taiwan Semiconductor Manufacturing Co (台積電) rose 5.7 percent to close at NT$237.50, while smartphone camera lens supplier Largan Precision Co (大立光) rose 4.25 percent to NT$5,270, its highest since November 29 previous year.

Earlier, the US Dollar was on the backfoot versus the Japanese Yen as well as the common currency Euro.

Some of the numbers in the video may be in dispute, but the potential of devastating losses to USA farmers is a concern voiced by many agricultural groups and their representatives. "I want them to do well", he said.


But General Electric sank 4.5 percent after it reported a 29.7 percent drop in second-quarter earnings to $615 million on continued power industry weakness. GE, which has been selling and splitting off businesses, also cut its forecast for how much cash its businesses will generate.

After weeks of apparently fruitless negotiations, the US early this month imposed 25% tariffs on approximately $34 billion of Chinese mechanical and technological products - sparking an immediate response from Beijing, which said it would hit back dollar for dollar. The Trump administration is considering tariffs on another $200 billion in goods.

The U.S. and China are threatening a trade war over Trump complaints that Chinese companies steal trade secrets and force U.S. firms to hand over technology in return for market access. There is already pushback in the US from businesses that will take a hit in an escalating trade war. If the yuan falls too quickly, it could prompt money to flood out of China as investors lose confidence and seek to exchange it for assets in dollars and other currencies.

Looser policy tends to pressure a country's currency. If the answer is yes, the administration says it could slap 20 percent to 25 percent tariffs on $335 billion of auto imports.

USA crude rose 0.81 percent to $70.02 per barrel and Brent was last at $73.15, up 0.79 percent on the day. Silver gained 1 percent to $15.55 an ounce.


Brent crude pared an early 0.9 percent gain to be up 0.2 percent by 1145 GMT at $72.69 per barrel. Natural gas lost 0.4 percent to $2.76 per 1,000 cubic feet. The EUR/USD is trading at $1.1641, down 0.04%; the pair has ranged from a low of $1.16357 to a peak of $1.16598. Copper jumped 2.2 percent to $2.76 a pound.

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