The Rhetoric Between US and China Heats Up, But Markets Remain Calm
Skerdian Meta • 1 min read
US and China reached a partial trade deal last month, which improved the sentiment in financial markets a great deal. As a result, safe havens have turned bearish, with USD/JPY running higher. But, we have heard some comments recently implying that the trade deal might be postponed for December.
Today, US Secretary of State Mike Pompeo was speaking in Berlin and he made a few comments which China didn’t like. Below are his comments and China’s response:
Mike Pompeo’s Comments via Reuters:
- Pompeo told the German audience that your own intelligence chief has said Huawei cannot be trusted
- Referencing Nord stream 2 gas pipeline: we don’t want Europe’s energy supplies to depend on Putin’s whims
- We seek all nations’ help in bringing Tehran back to the negotiating table
- NATO needs to grow and change otherwise runs the risk of becoming obsolete
- We want more trade with Europe
- Irrational to think of Russia as a worthy partner in the Middle East
- US officers are still on the ground in Syria, we did not withdraw
- China today suppresses people with tactics that would be ‘horrifyingly familiar’ to East Germans
China’s Global Times Editor Response via Twitter:
These comments don’t sound too positive when it comes to trade negotiations and the trade deal. They haven’t signed the “Phase One” deal yet and there’s a long way until the full trade deal, so these sort of comments surely don’t help, but markets are not affected. USD/JPY is still bullish, so markets are convinced that the “Phase One” deal will be signed, at least.