The trade war seems to be on everyone’s mind today. Donald Trump announced that he might postpone concluding a trade agreement with China until after the 2020 Presidential elections in the United States. This is something political analysts speculated about earlier this month, as it might give Trump’s re-election campaign a much needed focal point.
The US President did not say that he will leave the deal for after the election with absolute certainty, but the fact that he is considering it may still cause a significant delay in the negotiations between the two countries. A deal before the year’s end is now completely out of the question, and a new round of tariffs will hit Chinese goods in two weeks’ time.
Moreover, Trump also hit Brazil and Argentina with additional tariffs on steel and aluminum, stressing the commodity markets further.
Europe has also come up within the context of trade wars, as Donald Trump decided to tax French goods coming to the United States. Though Trump says his tariffs are a response to a new French law that taxes digital services, now the President of France, Emmanuel Macron, said that there will be new measures to retaliate against Trump’s latest decision. The two Presidents are currently not on good terms and are likely to clash during the upcoming NATO summit.
The news of more tariffs has affected the commodity markets negatively. As investors gear down for this week’s OPEC summit, it seems extremely likely we would see an extension of the agreement to keep oil output levels limited.
