Let's Not Declare Trade War Yet
|Trade tensions have risen. No doubt about it, but to consider this a trade war is premature. We should not pretend that this is the first time that the US adopted protectionist measures that ensnarled are military allies.
We have been to this dance before. Countries will respond with some symbolic retaliation on a small number of goods that make a little more than a rounding error in bilateral trade, take some measures to ensure that the defection of the US does not lead to an import surge, and appeal to the conflict resolution mechanism at the WTO.
Being in Hong Kong as this two-week business trip winds down, I had the privilege of visiting with Yvonne Man at Bloomberg and tried to lay out this less emotive read of developments. Here is a 90-second clip.
In terms of the price action, the dollar was slipping through the JPY105 level in early Asian turnover. I suggest to Yvonne that a convincing break of it would target JPY100.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.