US: Trying to resolve the escalating trade and political tensions with China - Rabobank

Analysts at Rabobank note that the Wall Street Journal reported for the umpteenth time that US President Trump and Chinese President Xi Jinping are planning a meeting around the G-20 in November to try to resolve the escalating trade and political tensions between the two.

Key Quotes

“That’s the same story that involves US Treasury Secretary Munchin and White House Economic Advisor Kudlow; the same story that usually boost US stocks; and the same story which keeps turning out not to have any substance to it.”

“The US has thrown China one small bone: reports are now that Mnuchin will on Monday declare that yet again China is NOT a currency manipulator. Obviously China isn’t. Yes, it’s aggressively mercantilist and has draconian capital controls in total defiance of IMF reserve currency norms: but it isn’t artificially lowering its currency - that lowering is going to be entirely natural when it comes, trust me. The response in CNY has been strong: it is currently back at around 6.90.”