US-China trade deal heralds period of lower volatility for investors
|Today’s agreement appears to be a “win” for both sides. The US negotiated a one-year reprieve from sweeping rare-earth export controls and received a pledge from China on agricultural purchases. China, meanwhile, had their fentanyl-related tariffs halved to 10%.
The market reaction resembled a “buy the rumour, sell the fact” pattern, with investors already bracing for some positive news following earlier encouraging signals, particularly from Treasury Secretary Bessent. We regard the outcome as positive, though not unexpected. Touch wood, the worst of the trade war appears to be behind us, but the relationship will need to be managed carefully.
A flare-up in tensions down the road is not entirely out of the question, as some important issues remain unresolved.
Moving forward, investors may see lower volatility, as one of the biggest tension points that rocked markets earlier this year has been dealt with.
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.