“US-CHINA TARIFF TRUCE Lifts Markets, Yet Recession Fears and AI Chip Tensions Keep Investors Wary.”, – WRITE: www.fxempire.com
“LOTS OF CONFUSION ON WHAT US TARIFFS ON China Are Now. Key Point: The Two 10% Tariff Hikes for Fentanyl and the 10% Universal Tariff Hike“ Stack ”on Top of Tarifs From. Tariff Rate Is Near 50%. ”
Despite The Cut, Tariffs Remain Far Above Levels Seen Durying Trump’s First Term and As of February 2025. Nevertheless Since Monday’s Announcement, Beijing Has Loosed Controls by:
- Pausion Export Controls on 28 US Entities for 90 Days.
- Granting Export Permits to at Least Four Chinese Rare Earth Magnet Supppliers.
- Removing the Ban on Boeing Deliveries.
Despite the TRUCE, The US Issued A Global Warning Against USING HUAWEI AI CHIPS, SIGNING A TOUGHher Stance on Tech.
US Recession Risks and China’s Demand Woes Mounting Tariff Pressures on Both Economies May Shift Washington and Beijing’s Approach. Recent Economic Data from China Revealed The Effects of Us Tariffs, Potentilly Pushing Beijing Town De-Escalation.
Deflationary Pressures Persified in April, While Private Sector Pmi Data Showed Further Job Losses, Signaling Weaker Demand.
Alicia Garcia Herrero, Natixis Asia Pacific Economist, Remarked:
“While China has Clearly Outsmarted the Trump Adminstation, Reaching A Very Beneficial Deal, The Chinese Economy Is Not Doing Well PRICES), AND WEST GOT VERY Weak Loan/Total Social Finance Data.
New Yuan Loans Rose by Cny280 Billion in April, Down Sharply From Cny3,640 Billion in March, Well Below An Expectored Cny700 Billion. Weak Credit Demand Could UnderCut Beijing’s Stimulus Efforts and Weaken Consumption If Labor Market Conditions Worsen Further.
In the US, Fears of A Recession Are Also Raising Alarms About Fiscal Sustainability. The Kobeissi Letter Wrote:
“The US GOVERNMENT CANNOT AFFORDA A RECESSION. IN PREVIUS ECONOMIC CYCLES, The US BUDGET DEFICIT WIDEned by ~ 4% of GDP on AVERAGE During Recessions. if a recession hits in 2025. That said, if the US Enters A Recession, Long-Terest Rates Will Likely Go Down.
The Note Concluded:
“However, this Means Government Finns Wuld be by the More Than Amount Saved in Interest Due to A Recession. An Economic Downturn Wuld Be Incredibly Costly for the Government.
INVESTOR CAUTION WEGHS ON Asian Markets While Investors Initially Celebrated the Trade Truce, Doubts Remain Over Whather A Lasting Trade Agreement Is Achievable.
The CSI 300 Fell 0.58% On May 15 White The Hang Seng Index Slipped by 0.17% in Early Trading, Holding Below The Crucial 24,000 Mark.
In Contrast, The Nasdaq composite Rose 0.72% on May 14, Narrowing Itd Gap with The CSI 300. The CSI 300 is Now Down 0.41% Year-to-Date (YTD), while The Hang Seng Index Continues to Lead with A 17.5% GAIN YTD.