There is no letting down in US President Donald Trump's trade wars, on three fronts. In North America, the row Trump had with Canada's Prime Minister Justin Trudeau joined stalled NAFTA talks. The European Union is about to impose retaliatory tariffs against the US, and it will not be surprising to see a US counter-retaliation. And with China, the world's second-largest economy after the American one, the dispute is getting worse. After slapping China with tariffs worth $50 billion and the angry response, the Administration is now considering adding a 10% tariff on no less than $200 billion worth of goods.
It's the time of the Trade Wars
US President Donald Trump is picking fights on trade, and not only on trade, as he said that the German government is not acting according to the will of the people on immigration. As mentioned in the past, there are three open fronts: the North American one, the European one, and the Chinese one. Uncertainty about the future already takes its toll as some orders and investment are postponed. At the moment, the impact of the trade clashes is still limited, and the global economy is doing great. However, we are nearing the point of no-return and a full-blown crisis is around the corner. The time left until these dates allow for negotiation and reaching some agreements that would defuse the situation.
Quote of the day
Risk aversion dominates the FX board as trade tensions between the US and China returned, with Chinese authorities reiterating that they will fight back to the end. Wednesday, the EU announced that will start changing import duties of 25% on US products starting this Friday, while today the Turkish government imposed tariffs of $266.5 million on $1.1 billion worth of US goods, both responding to the US decision over tariffs on steel and aluminum imports.