It would hardly surprise anyone that the first piece of news for today has to do with the trade war between the United States and other countries, most notably China. According to the Chinese government, they are preparing for a real trade war. China was slapped with US tariffs first in the amount of $50 billion, then President Trump announced more tariffs against China’s retaliation, which are on an additional $38 billion of Chinese products. Reportedly the People’s Bank of China will cease buying US Treasury bonds, which can have a major impact on the US economy since China is among the greatest buyers of treasuries.
The worsening trade relations between the United States and China are also affecting stock markets, as many companies manufacture goods in China, or at least trade with its vast market. American, European, and Asian stocks all registered losses.
Amid the trade war talk the US dollar remains strong, since investors are moving away from equities in order to avoid risks. The dollar index a bit earlier was near 94.44 and remains high.
