For this bank, “it is not clear if China and the United States could reach an agreement to reach a tariff truce” because the “bar seems to be high.”
There is no truce in sight for the tariff war between the United States and Chinaaccording to analysts of the JP Morgan. Investors waiting for an agreement between the Trump and China administration similar to that declared by Mexico and Canada on Monday They will feel disappointedSaid China’s chief economist from JP Morgan, Haibin Zhu, in a note on Tuesday.
“We are not anxious to change our base hypothesis of increased tariffs to 60%. We maintain the opinion that it is more likely that the tariff war between China and the United States intensify from nowbut with great uncertainties about the moment, the rhythm and the magnitude of a new increase in tariffs, “they warned.
Tuesday, China announced a 10% general tariff before the taxes that USA imposed on Chinese imports. China’s tariffs against the United States will begin to be applied on February 10 and include a 15% tax on liquefied coal and natural gas, together with 10% tariffs on agricultural machinery, crude oil and some cars.
According to the economist, The alleged visit of President Donald Trump to China could be an opportunity to negotiate. At least, a personal negotiation during a diplomatic trip could mean that the highest tariffs are gradually applied.
Trump’s truce with Canada and Mexico
The President Donald Trump decided to suspend for 30 days the strong tariffs with which he threatened Mexico and Canada After the last minute negotiations with their two neighbors.
The president can exhibit as a victory the concessions on border security and fight against crime. But The Prime Minister of Canada, Justin Trudeau, and the Mexican president, Claudia Sheinbaum, political triumphs can also be attributed.
Experts argue that President Trump’s high -risk confrontation with the closest business partners of the US allowed Mexico as Canada reinforces border security and taking more important measures to address fentanyl traffic.
It should be noted that, previouslyTrump’s tariffs on steel and aluminum during their first mandate caused the opposite reactions of Mexico, Canada and the European Union (EU)but economists say that these measures had a more limited range.
On this occasion, Trump promised overwhelming tariffs on products from Mexico and Canada, as well as to China, to which a 10% tariff increase was applied on their products since Tuesday. But it still is not clear if Trump will fulfill his threats against Canada and Mexico once the 30 -day deadline is finished.
Source: Ambito
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