The President of the United states of America Donald Trump stated he will impose 10 % on $200 billion worth of Chinese imports. Those duties will go up to 25% at the year-end.
This statement was announced by the Trump administration yesterday and it will escalate even more the trade war between the world’s two largest economies. The US removed about 300 goods from the previous list of products affected, including chemicals, smartwatches, and other products such as high chairs.
The US President said that the tariffs probably will rise to 25% on Jan. 1, 2019, and he added that “if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports.”
Asia markets remain mixed due to the US-China trade war
On Tuesday afternoon Asia markets were mixed in fear of an escalation in trade tensions between the United States and China. Australia’s ASX 200 went down 0.45% as the energy sector continued to drop and lost about 1.60%. The sub index lost its earlier profits and was mostly in a range as AMP went down about 1.25%.
The Reserve Bank of Australia’s minutes from its September policy meeting had highlighted that global tensions from trade policy presented a “material risk to the outlook.” On the other hand, Topix index was up about 1.64% and Japan’s Nikkei 225 rose about 1.35%. In South Korea, the Kospi went back to the positive area by going up about 0.12% as the performance of blue-chip stocks remained mixed. Korea Electric Power Corporation went down 1.33%, Samsung Electronics went up by about 1.40 %, and Hyundai Motor was up by 0.39%.
Oil prices drop as trade war clouds remain black
On Tuesday Oil markets went down as the latest escalation in the China-U.S. trade war was brought into focus again, in particular since these two countries are the world’s top two oil consumers. Brent crude futures fell about 43 cents, which is about 0.5%, to $77.61 per barrel. U.S. West Texas Intermediate (WTI) crude went down 28 cents, or 0.4%, to $68.62 per barrel.
On Monday The U.S. President Donald Trump said he would impose 10 percent tariffs on about $200 billion worth of Chinese imports. Wang Xiao, head of crude research at Guotai Junan Futures, said on Tuesday “The growing trade dispute has hurt trading sentiment. The impact on economic growth is slowly dripping in, which again hurts oil prices.”
Gold falls as investors turn to dollar for safety
On Tuesday Gold prices went down while investors try to find safety in the U.S. dollar due to the concerns of slowing global trade after the United States started a new round of tariffs on Chinese imports. Yesterday the U.S. President Donald Trump imposed 10% tariffs on about $200 billion worth of Chinese imports and warned of more tariffs if China retaliated.
The U.S. gold futures fell 0.2% at $1,203.90 an ounce and the Spot gold fell 0.2% at $1,197 an ounce, after rising about 0.5% in the previous trading session.
ANZ analyst Daniel Hynes said “Gold is facing a couple of headwinds … The impending rate hike by the Fed is weighing on and obviously, the escalation of trade conflict is pushing investors back into the U.S. dollar,”
“This (trade woes) has not helped gold prices at all. It is likely to be a pretty tough environment for gold in the next couple of weeks as it battles these two fronts.”