US CHINA TRADE WAR – TALKING POINTS
- Chinese Vice Premier Liu He is set to travel to Washington, DC next week for the eleventh round of trade talks
- The offshore Yuan currently trades near the 6.7360 price level which appears to be the pivot for indecision on the US China Trade War[1]
- Movements in the less-constrained Hong Kong Dollar could foreshadow whether or not a trade deal will be reached
- Check out this article on Using News and Events to Trade Forex[2]
Last Tuesday, White House Chief of Staff Mick Mulvaney disclosed that the US-China trade war “will be resolved one way or the other” within the next two weeks. The following day, US Treasury Secretary Stephen Mnuchin announced that he concluded another round of “productive meetings” with China’s Vice Premier Liu He in Beijing which will continue on Monday in Washington, DC.
Response to the encouraging news was restrained, however, as markets have seen similar jawboning headlines from officials for several months now as the trade war between the world’s two largest economies endures. Furthermore, the South China Morning Post recently reported that recent rhetoric from the Trump administration “is merely a trick to increase tensions and generate pressure on the other side.” So where exactly do the US-China trade talks stand and how might markets gauge its possible resolution?
WATCH THE YUAN
Once USDCNH[3] touched the 7.000 level in October last year, news began to break out that positive developments were being made towards a deal and the tit-for-tat trade war between the US and China was no longer escalating. Consequently, this marked the start of the renminbi’s recent recovery against
