Markets dive after ‘Tariff Man’ threat by Donald Trump

Markets dive after ‘Tariff Man’ threat by Donald Trump

John Williams, president of the Federal Reserve Bank of NY, also unnerved investors by telling reporters Tuesday that he supports further Fed rate hikes.

China, for its part, also agreed to offset its massive trade imbalance with the U.S.by buying more, but not yet specified amounts, of energy products, agricultural, industrial and other products.

Trump has exaggerated the effect of the tariffs on US revenue. He said the "implicit potential threat" of new tariffs had been reduced after the meeting. They announced that China had agreed to buy many more American products and to negotiate over the administration's assertions that Beijing steals American technology.

Volkswagen AG and Daimler AG executives both said they thought the chances that new tariffs will be imposed had been lessened following the meeting.

"I think that if you put the two press releases together, you can see what basically happened", Cui Tiankai told Reuters in Washington on Monday after returning from Buenos Aires, where he had joined Xi's delegation.

Stocks in the U.S., Europe and Asia fell sharply after Trump declared himself "a Tariff Man" who wants "people or countries" with intentions to "raid the great wealth" of the U.S.

Trump and si entered into a 90-day trading the truce, postponing the scheduled January 1 increase USA import duties on Chinese goods worth $ 200 billion with 10 to 25%, while there is discussion of a trade transaction.

However, Mr Trump risked more confusion over the state of relations when he took to Twitter to say: "We are either going to have a REAL DEAL with China, or no deal at all - at which point we will be charging major Tariffs against Chinese product being shipped into the United States".

"Ultimately, I believe, we will be making a deal - either now or into the future", he wrote.

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On Monday, Kudlow said there was an "assumption" that China would eliminate auto tariffs, not a specific agreement.

Those 10 percent tariffs were scheduled to ratchet up to 25 percent on January 1 if the USA and China failed to reach an agreement to at least postpone that move.

China's reticence contrasted with the parade of USA officials talking about the deal on Monday, including Treasury Secretary Steven Mnuchin and White House Economic Adviser Larry Kudlow.

Another significant take-away from the preliminary agreement could be its impact on energy markets, both USA oil import to China and perhaps even more importantly from a development perspective liquefied natural gas (LNG) imports.

Many economists have expressed skepticism that very much could be achieved to bridge the vast disagreements between the two countries in just 90 days.

Goldman Sachs analyst Alec Phillips said the USA and China made little concrete progress at G20, which was what he anticipated heading into the meeting. We are right now taking in $billions in Tariffs. Trump named U.S. Trade Representative Robert Lighthizer to lead the talks with Beijing.

Among the conflicting assertions that White House officials made was over whether China had actually agreed to drop its 40% tariffs on US autos.

"China will start with the implementation of the specific matters in which consensus has been reached, the sooner the better", it added, without providing more details.

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