Markets fall on trade war fears

American FX Outlook: Trade War Between World Economic Superpowers Has Begun

ING's Leering notes that China has not set a date for implementing the $50 billion in tariffs it slapped on more than 100 USA goods.

"There's going to be a tit for tat and hopefully it settles down".

Trump unveiled the tariffs in response to assessments that China's theft of American copyrights on intellectual property is costing the USA economy billions of dollars each year. Most importantly, he viewed the trade deficit as the most important thing in global trade.

On Wednesday, the US and China traded tough words. I warned President Trump as much in a White House meeting in February.

China said today it was ready to pay "any cost" in a possible trade war with the United States, after President Donald Trump warned he was considering US$100 billion (RM387 billion) in extra tariffs.

The move went against the interests of China, the United States and the world economy, seriously violating the basic principles and spirit of the World Trade Organization (WTO).

"The U.S. list suggests that the government is targeting the "Made in China 2025" initiative, while China's retaliation intends to bring Americans back to the negotiation table", Zhou Hao, an economist at Commerzbank in Singapore, said in an email.

On the other hand, Chinese leaders are super confident on winning against the battle against China as they look very much confident on winning against the tariff war.

Soybeans topped the list, which also included corn, tobacco products, cars and other vehicles, plastics and chemicals.

Washington on Tuesday proposed $50 billion in duties on Chinese goods aimed at forcing Beijing to address what the United States says is deeply entrenched theft of US intellectual property and forced technology transfer from USA companies. I guess that is the basis of claiming that these are somehow the opening gambits of a future negotiation but Americans import products from China because it is less expensive.

The complaint is valid, but a trade war would be a reckless overreaction.

"Soybeans, that's our top agricultural commodity exported to China", said Tony Banks, assistant director of commodity marketing at the Virginia Farm Bureau Federation.

"We have the backs of farmers in this administration", Navarro told CNBC in an interview.

So far, no tariffs have actually been imposed. "But from an economic and financial perspective, the iPhone is a USA product, and the US benefits the most from it", said the report.

The memorandum is based on a so-called Section 301 investigation, launched by the administration in August 2017, into alleged Chinese intellectual property and technology transfer practices.

Tensions between the United States and China escalated again this week as both countries issued dueling plans to impose new tariffs on imported goods. That number accounts for roughly a third of China's imports from the USA last year, versus less than one-tenth of China's exports to the US, according to data from The International Monetary Fund.

USA officials say they'll hold hearings on the administration's proposed target list of 1,300 products in mid-May and haven't set a deadline for when the tariffs would take effect.

Beijing says Washington is the aggressor and is spurring global protectionism. Foreign companies complain that the initiative will limit or outright block their access to those industries.

"Markets seem to be in relief rally mode and part of this is really driven by the fact we're not really in a trade war yet", said Charlie Ripley, senior investment strategist at Allianz Investment Management in Minneapolis.

ENERGY: Benchmark U.S. crude fell 34 cents to $63.20 a barrel in electronic trading on the New York Mercantile Exchange.

At the same time, Chinese officials seem to believe they can take advantage of what they consider vulnerabilities in the United States political system.

Washington's 1,300-product long list was focused on Chinese industrial technology, transport and medical products and tailored to do the least damage to American consumers. In 2016, China purchased $14 billion worth of USA soybeans, many produced in states Trump won.