China–U.S. trade war threatens to weaken economies
According to CNBC, U.S. President Donald Trump said August 1 that beginning September 1, the United States will place 10% tariffs on another $300 billion worth of Chinese goods.
According to CNBC, U.S. President Donald Trump said August 1 that beginning September 1, the United States will place 10% tariffs on another $300 billion worth of Chinese goods. In response, on August 5, the Chinese government allowed its currency to fall below a symbolically important seven-to-the-dollar level, an apparent retaliatory move that amounts to trade tensions spreading into another arena. The United States returned fire by formally naming China a currency manipulator. The following day, China has suspended purchases of U.S. agriculture products.
According to Reuters, China said the threat of new tariffs is a “serious violation” of the agreement the two countries struck in late June at the G-20 in Japan. At that time, President Trump agreed to allow U.S. companies to resume selling products to Chinese telecommunications company Huawei Technologies and said that China would soon purchase large quantities of U.S. agriculture products. But a round of trade talks between the countries last week made little progress and the U.S. escalated trade tensions by saying it would implement additional tariffs starting September.
According to the Los Angeles Times, “the threat that the trade war might expand into a currency battle has raised the odds of a U.S. recession at the end of next year.”