- U.S. Commerce Department said that it imposed duties on Chinese and Mexican structural steel.
- People's Bank of China announced stimulus plans by way of the RRR which lifted risk appetite.
Following growing concerns over global growth, with the latest ISM Manufacturing data from the US coming below par to fall in line with a series of weak PMIs from around the globe, in the latest noise with respect to trade wars, the U.S. Commerce Department said overnight that it imposed duties on Chinese and Mexican structural steel after making a preliminary determination that producers in both countries had dumped fabricated structural steel on the U.S. market at prices below fair market value.
"The department said it imposed duties of up to 141% on Chinese structural steel and up to 31% on Mexican structural steel and will begin collecting cash deposits for imports based on those rates," according to Reuters:
Most Chinese steel products have largely been excluded from the U.S. market by prior Commerce Department anti-dumping duties and President Donald Trump’s 25 percent punitive tariffs. The latest order seeks to prevent Chinese downstream structural steel assemblies from skirting those duties and entering the United States.
Commerce found that one Chinese producer, Modern Heavy Industries (Taicang) Co Ltd, did not dump product into the United States, but it imposed dumping rates of 52% on Wison (Nanton) Heavy Industry Co Ltd and up to 141% on other Chinese fabricators.
The department is scheduled to release final anti-dumping duties in its fabricated structural steel investigation on or about Jan. 24, 2020. The U.S. International Trade Commission needs to find that American steel fabricators suffered injury from Chinese and Mexican imports for the duties to be locked in place for a five-year period.
China to aid economy
China makes Indeed, there is much focus on China's economy as well as the US and there is a great deal of focus on the Yuan currently which has hit an eleven-year low. Growth in China has slumped to its lowest level in 27 years, with its domestic GDP growing at the worst pace since 1992 - Though at 6.2%, it's still triple American growth figures. In more positive developments, the People's Bank of China announced stimulus plans by way of the bank reserve ratio (RRR) adjustments whereby a reduction in the amount of funds banks have to hold in reserve would be aimed at releasing cash into the slowing economy. In addition to the RRR cut, the cabinet called for an acceleration of the issuance of so-called special bonds by local governments that are used to pay for infrastructure spending - This news helped to lift investor spirits and buoyed global equities higher overnight - The Dow Jones Industrial Average, DJIA, put on 237.45 points to reach 26,355.47, a gain of 0.9% while the S&P 500 index added 31.51 points at 2,937.78 for a 1.1% gain.
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