(07 MAY 2018)DAILY MARKET BRIEF 2:US – China commercial tensions are economically felt

(07 MAY 2018)DAILY MARKET BRIEF 2:US – China commercial tensions are economically felt

7 May 2018, 13:48
Jiming Huang
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Mnuchin US treasury secretary talks with Chinese premier Liu He on Friday confirmed a rather rough start for both nations who are somehow trying to endeavor a win-win agreement, a relatively less likely scenario as long as both nations won’t get prepared for a “give and take” scheme. Accordingly, Chinese first quarter current account balance deficit above USD 28 billion (prior: USD + 62 billion), a historical low, strongly reflects the fact that both nations must count on much smaller surplus in the near future as long as bilateral tensions are not restored. The final accord on China’s current account surplus over the US could have important repercussion on the CNY, which would be much weaker and volatile if its trade suplus is expected to shrink.

By Vincent Mivelaz

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