And on the tariffs front, the US will maintain 55% tariffs on China. The breakdown for that is 10% reciprocal tariffs, 20% tariffs on fentanyl, and 25% tariffs that were already in place before Trump took office. Meanwhile, Trump said that China will only slap the US back with 10% tariffs in return.
As much as Trump would want markets to believe that the US is getting a win on rare earth exports, this is merely just kicking the can down the road. China still dominates the market in that regard and if there are any issues again moving forward, this is one spot that China can easily circle back to in retaliating against the US.
And I would expect Xi to plan out the same kind of strategy this time around. Amid risking a never-ending escalation of tariffs, this at least is avoiding the worst-case scenario for both sides.
In any case, this so-called "deal" or framework of one also still needs approval by Xi. So, let's see if he will offer up his hand as Trump looks to want to shake it in acting for the cameras.
This article was written by Justin Low at www.forexlive.com. Read More Details
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