Trump’s economic gamble: Solid job gains vs. risky trade war

Trump’s economic gamble: Solid job gains vs. risky trade war

Trump’s economic gamble: Solid job gains vs. risky trade war

US President Donald Trump has warned that the US may ultimately target more than $500bn worth of Chinese goods, an amount that roughly matches its total imports from China previous year.

Rakuten Trade Sdn Bhd head of research Kenny Yee believed any decline will be short-lived and that investors will eventually return to Asia given its superior economic growth over the past 10 years. But for now, employers, investors and US consumers are weighing the perils of a prolonged rift between the world's two largest economies against a far more positive backdrop: America's healthiest job market in years.

In the months ahead though, China will struggle to replace the US beans, forcing processors, which crush the beans to make oil and animal feed, to pay the extra duty or find substitutes.

Instability and uncertainty in global trade regime would not be good in any way for Bangladesh economy, he said. A lot of them were lower, between 0.04 percent and 1.4 percent, although trading volumes were very light. "Nonetheless, wage growth remains stubborn, and the potential for an enduring trade war could - and perhaps should - give the Fed reason for pause".

The Korea Institute for International Economic Policy (KIEP) estimated that Korea's exports would shrink by $237 million during the first phase of a trade war between the USA and China that kicked off on Friday. Average hourly pay rose just 2.7 percent from a year earlier, which means that after adjusting for inflation wages remain almost flat.

While the majority these are with the US, China also has 13 trade disputes with the European Union, plus a handful of others with countries including Japan and Mexico. Many caught in the initial line of fire -U.S. farmers absorbing tariffs on their exports to China, for instance -are fearful. But German automaker BMW (BMWG.DE) said it is unable to "completely absorb" new Chinese tariff on imported USA -made models and will raise prices. But the pain could intensify. Trump has continued to threaten Beijing with escalating tariffs on as much as $450 billion worth of Chinese goods. He added that for now, "He's called the bluff of other countries that have basically been abusing" US companies and workers. But President Trump said Thursday that he's prepared to impose tariffs on up to $550 billion in Chinese imports-a figure that exceeds the $506 billion in goods that China actually shipped to the United States past year. He said in a speech in Montana last week that other countries will agree to his terms - "and if they don't, we'll actually do better". "We opened our country to their goods, but they put up massive barriers to keep our products and our goods the hell out of their country because they didn't want that competition".

Because of this first round of hostilities, American businesses and, ultimately, consumers could end up paying more for such Chinese-made products as construction equipment and other machinery.

Still, some USA companies are benefiting. It says it's already sold twice the plant's capacity for the first seven years of production after actions by the US government to protect America's aluminum industry.

Kim said politically Trump's trade war is targeted at shoring up support for the mid-term elections in November and economically it is targeting at improving the USA trade deficit.

Carney compared the uncertainty on trade to the bank's effort to bolster the United Kingdom economy ahead of Britain's departure from the European Union. Administration officials have encouraged this view.

White House Council of Economic Advisers Chairman Kevin Hassett, in an interview on Fox Business Network on Friday, said Trump is "going to deliver better (trade) deals". "It's absolutely the number-one agricultural trading partner-soybeans to China." said Wilkins.

A calamitous trade war would likely be the "result of miscalculation or unintended consequences, rather than an explicit goal", Adams added. Trump's tariffs are meant to pressure Beijing to reform its trade policies. It accused the US of igniting "the biggest trade war in economic history".

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