After Trump’s capitulation on 30th October, China has (temporarily) rolled back its retaliatory measures. Exports and trade surplus continue to rise, despite a 30% drop off in US bound goods. Both core inflation and CPI remain low, albeit perhaps too low.
Having successfully stared down President Trump and his nonsensical trade war, President Xi Jinping and China have (temporarily, for one year) suspended all of the countermeasures that they put in place in response to US measures. This is no climbdown for China, merely a return to the prior status quo before the US launched its attacks post “Liberation Day”. And whilst trade with the US has taken a 29-33% YoY (November) nosedive, it seems to have done nothing to dent China’s economic prowess – for November data show that YoY exports have risen 5 to 6%, that the monthly trade surplus has hit a staggering USD111.68 Bn, and that the January to November surplus has now exceeded an astonishing USD1.07 trillion. Recognising the likely, and...
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