IT'S starting to look like the Sino-American relationship is now in a downward spiral, with the recent escalation in the trade war between the two countries.

US President Donald Trump has threatened to impose additional tariffs of 10 per cent on a further US$300 billion in Chinese goods on Sept 1. In response, China's central bank allowed the yuan to weaken against the greenback - a move which makes Chinese exports cheaper in the global markets. The reaction from Washington was furious, with the Treasury Department taking the extraordinary step of labelling China a "currency manipulator". That in turn was followed by China's announcement that it would stop buying agricultural products from the United States.

All of that makes for very bad news, given that the US and China built up, in the last three decades, the biggest trade relationship in the world. So it is not surprising that much of the attention of politicians and the media in recent months has been on the economic costs of the trade battles between the two countries.