President Trump on Friday threatened to place tariffs on all goods imported to the US from China in a major escalation of the burgeoning trade war between the two nations. "I'm not doing this for politics, I'm doing this to do the right thing for our country", Mr. Trump said. China accused American officials of making false accusations Thursday as it fired back against a claim President Xi Jinping is blocking talks with the US over the trade war between both nations.
Leaders at the Fed seemed unfazed by Trump's remarks, however, emphasizing that US monetary policy operates independently from political concerns. Yet he said he has not pushed the tariffs out of any ill will toward China.
"Because we go up and every time you go up they want to raise rates again". "I want them to do well", the U.S. President said of China. "I really like President Xi (Jinping) a lot".
US Treasury Secretary Steven Mnuchin, in Buenos Aires yesterday for the Group of 20 meeting of finance ministers and central bank governors, was asked if he was concerned that China might be using its currency as a weapon in the escalating trade fight with the US.More news: Zaman breaks 38-year-old record
"The reason we are not up more is the push and pull that has been the case for the past two months", said Walter Todd, chief investment officer at Greenwood Capital in Greenwood, South Carolina. Nine of the top 10 soybean-growing states in the USA voted for Trump, it highlights.
China's central bank is already allowing the tightly controlled yuan to drift lower against the dollar in a bid to help Chinese exporters cope with Trump's tariff hikes.
After weeks of apparently fruitless negotiations, the US early this month imposed 25% tariffs on approximately $34 billion of Chinese mechanical and technological products - sparking an immediate response from Beijing, which said it would hit back dollar for dollar. Earlier this month, the U.S. also scheduled additional tariffs on $16bn of Chinese electronics and other components. A tariff is a tax on a good coming into the USA, also known as a duty.
Investors as a whole appear to accept the argument of President Trump economic advisers, notably Larry Kudlow and Kevin Hassett, that the president's threats will likely force China, the European Union, Canada, and Mexico to eventually negotiate better trade deals.More news: Inside Trump's isolation after Putin summit, walkbacks
The People's Bank of China, which is in charge of China's exchange rate policy, has rarely responded to Trump in public.
The threat of targeting US$500 billion of Chinese merchandise was not new and the harsh proposal may have been a tactic to shift attention from widespread criticism of his meeting days earlier with Russian counterpart Vladimir Putin, she said.
China has pledged to retaliate against USA tariffs in "equal scale and equal strength".
His administration is considering tariffs of as much as 20% on United States automobile imports from Europe.More news: Prince George's fifth birthday sees new official photo released
Among companies reporting results, Microsoft won 1.8 per cent after reporting a 10 per cent rise in quarterly profit to US$8.8 billion behind strong revenue gains in internet search ads, gaming, Windows and other key businesses. But rate increases also make borrowing costlier for households and companies and can weaken the pace of growth.