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Like an autumn shower on a weary commuter, hopes of a break-through in the US-China trade war have been dampened again.
Stocks have fallen in Asia, and we’re expecting a weaker start in Europe, after US president Donald Trump gave a typically combative speech on trade affairs.
Trump told a lunchtime event at Economic Club of New York that he would impose yet more tariffs on Chinese imports, if the ongoing talks fail to produce an interim agreement.
In comments that can’t have help anyone’s digestion, the president declared:
“I tell it to everybody: If we don’t make a deal, we’re going to substantially raise those tariffs, they are going to be raised very substantially.”
Traders had hoped that Trump would signal that the next raft of tariffs on China – 15% on $156m of imports – might be frozen.
But instead, they heard some of Trump’s typical lines… An agreement is “close”, as Beijing is “dying” to cut a deal, and the US economy continues to “boom” on his watch (even through growth actually slowed in the last quarter).
This created some disappointment on Wall Street, where the Dow Jones closed absolutely unchanged last night at 27,691.49. That hasn’t happened since 2014.
In Japan, the Nikkei has dropped by 200 points or 0.85% to 23,319.87, while China’s SSE Composite dipped by 0.3%. Australia and South Korea both lost around 0.8%.
The main European indices are down about 0.4% in the futures market, following Trump’s speech.
Also coming up today
America’s top central banker, Jerome Powell, is testifying at Congress today. He could give fresh guidance about future interest rate moves, and the Fed’s concerns over the US-China trade war.
New UK inflation data, and the latest healthcheck on eurozone factories, are coming up this morning.
We’ll also find out whether British house prices continue to be hit by Brexit, following steady falls in London and parts of the South of England.
- 9.30am GMT: UK inflation for October: forecast to fall to 1.6% from 1.7% year-on-year.
- 9.30am GMT: UK house price inflation for September
- 10am GMT: Eurozone industrial production for September
- 1.30pm GMT: US inflation data for October: forecast to remain at 1.7% year-on-year
- 4pm GMT: US Federal Reserve chair Jerome Powell appears at the Joint Economic Committee Of Congress