The trade war between the US and China will likely intensify, as both sides seem to think they have the advantage over the other side. This is especially true of Trump, who is supported by a strong US economy and all-time highs in the stock indexes. Additionally, before the mid-term elections in November we expect Trump to solidify his image as a strong leader to support Republican candidates: a Democratic congress will likely intensify the pressure on him from the Mueller probe. The same is true of Xi Jingping. The pain for the Chinese economy from the trade conflict is not great enough to impel him to abandon his "Made in China 2025" plan.
The likely culmination of the conflict will be the imposition of 10% tariffs on $200 billion in Chinese imports. As long as the economy is strong the support for Trump will continue, and thus the chances that he abandons the trade war will remain small. Both sides of the conflict are waiting for the other side to fail, in order to extract concessions form a weakened opponent.
On the 30th of August the U.S. Trade Representative's office will publish the final draft of the new round of tariffs: most likely 10% on $200 billion of imports from China. After approval of the draft, the tariffs go into effect several weeks later.
Source: CNBC
Original post: US-China trade war poised to intensify
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