China is looking to de-escalate tensions with the U.S. in the ongoing trade dispute, stating that it will look to calmly resolve the issue through negotiation and collaboration. “China has plenty of means for counter-measures, but under the current situation, the question that should be discussed right now is about removing the U.S.′ new tariffs on $550 billion Chinese goods to prevent escalation of the trade war,” said Gao Feng, spokesman for China’s Ministry of Commerce.
This development comes at a time when President Trump had threatened to increase tariffs on Chinese exports worth $250 billion to the U.S. to 30 percent from the existing 25 percent, and tax another $300 billion products by 15 percent instead of the current 10 percent. However, it is yet to be seen how the two countries will set differences aside and solve this predicament through negotiations – particularly since the talks preceding this announcement have failed to bear any fruit.
Did you know?
According to Cargo Account Settlement System (Cass) data, the total volume of freight exported from Germany dropped by 24.6 percent on a weight basis in June this year compared with the same month in 2018.
“Fears of a near-term recession are overblown. Yes, there are yellow flags. But the yield curve will need to remain inverted for several more weeks for that signal to go from yellow to red.”
– KC Mathews, chief investment officer with UMB Bank, commenting on the inverted yield curve, which happens when rates for short-term bonds are higher than long-term Treasury bonds.
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Globally, there has been a noticeable slowdown in the auto industry, and the Indian market is no exception. The passenger vehicle segment has been the worst hit, with its sales plunging by 31 percent in July, based on figures released by the Society of Indian Automobile Manufacturers (SIAM). July recorded the sharpest fall in passenger auto sales in over 18 years and is the ninth-straight month of sales decline in the country.
Though the downturns across major Western economies can be attributed to the U.S.-China trade tariffs war and the Brexit debacle, India’s auto slowdown has been largely self-inflicted. Indian banks are struggling to recover several billions of dollars in non-performing asset (NPA) loans from companies that have either defaulted or are stalling. The last straw was a liquidity crunch in Infrastructure Leasing & Financial Services (IL&FS) in 2018, with the company crumbling under debt it could not repay, shocking markets and the credit economy. This led to banks tightening credit for consumers and automakers alike, leading to lowered auto consumption and auto businesses laying off workers.
Hammer down everyone!