China: What to expect from the G20 summit? – Standard Chartered

Standard Chartered analysts point out that their clients see the G20 summit on 28-29 June as a pivotal event that may determine the intensity of US-China trade tensions and the ensuing policy responses.

Key Quotes

“In the run-up to the summit in Osaka, President Trump continues to exert pressure on China on trade and other issues, while President Xi is preparing the nation for an extended trade war.”

“We are convinced that a meeting between the two leaders is in the making. Trump has expressed a strong desire to meet Xi at the summit. While China has yet to confirm the meeting, we do not think it will waste an opportunity to demonstrate its commitment to averting a trade war that could disrupt global economic growth.”

“Xi and Trump will likely agree on the principles for the resumption of trade talks.”

“We think the market may be too pessimistic about a trade deal within the next two to three months. The two sides appear to have reached an understanding on 90% of the issues after 11 rounds of talks; resolving the remaining issues will require more political will than time. Imposing additional US tariffs on all imports from China, which Trump has threatened in the absence of a deal, would likely take a big toll on the US economy in an election year.”

“If the G20 summit fails to prevent an escalation of the trade war, we expect China’s government to deploy more fiscal stimulus, supplemented by credit expansion and a possible selective easing of property-market policies, to keep GDP growth above 6%. The authorities may also allow more FX flexibility, partly due to shifting fundamentals.”

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.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD: Growth concerns to keep weighing on the sentiment

The EUR/USD pair closed a second consecutive week unchanged around 1.1840, as the dollar got to appreciate ahead of the close on upbeat US data combined with risk-off. Sluggish global economic growth to keep weighing on the market’s sentiment.


GBP/USD: Brexit deal and coronavirus second wave leading the way

The GBP/USD pair stalled its weekly recovery on Friday, ending the day in the red at around 1.2915. Mild hopes related to a post-Brexit trade deal with the EU provided modest support to Sterling earlier in the week.


Gold: Next week's key macroeconomic events to keep an eye on

The troy ounce of the precious metal closed the week modestly higher at $1,950 but struggled to make a decisive move in either direction. Following its September policy meeting, the Federal Reserve kept its policy rate unchanged as ...

Gold News

It was the best of times, It was the worst of times

Economic reports from most of the major economies show the pace of the recovery has slowed.  In the same way, the recovery began before the end of the  Q2, the loss of economic momentum was seen as early as July in some series and August in others.

Read more

After yesterday's JMMC meeting WTI settles near $40 per barrel

WTI has been through a rollercoaster this week. The liquid gold has been in a downtrend leading into the OPEC+ JMMC meeting and then reversed the whole move. At the meeting the group agreed to extend the compensation period for overproduction till the end of December. 

Oil News