Casualties of a US-China trade war
China has countered President Trump's opening salvo of tariffs on steel and aluminium with duties on key US agricultural commodities. How does this play out in terms of the US dollar and in China markets?
Add BT as a preferred sourceTIT for tat then rat-a-tat-tat. That's the sound of the beginnings of a trade war. President Donald Trump is renowned for his midnight bellicose tweets, but the problem is sorting out the meaningless tweets from the ones of genuine concern. Mr Trump fired the first trade war tweets with tariffs on steel and aluminium and this is of genuine concern.
It was a strange place to start as China is the fourth largest source of steel imported into the US with around 2 per cent market share.
China hit back with more sensitive and strategic tariffs that hurt Mr Trump's redneck heartland base of mid-western farming communities. Unless extreme care is exercised, the only way from here is a downward spiral that undermines the current global rules around trade and the World Trade Organisation that is charged with resolving trade disputes.
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