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China Steps Up Response to US Tariffs; USD Strengthens on Employment Data

Published April 4, 2018
  • The Trump administration released its list of Chinese imports subject to tariffs yesterday, including industrial, transport, and medical devices with a trade value of $50 billion annually.
  • China had initially responded late Sunday with import tariffs of its own on up to $3 billion of US products, including nuts, pork, and wine, but this morning China announced it will now also seek tariffs on up to $50 billion of US products imported by China, including aircraft, soy beans, whiskey, and tobacco.
  • US stock futures were negatively impacted by the news as it fueled ongoing fears of a global trade war. USD also fell against the yen, as Japan is traditionally seen as a safe-haven currency.
  • The greenback, however, is up against the loonie, rebounding off yesterday’s sharp decline, while also getting a lift from a stronger than expected change in non-farm payroll (241K vs 208K expected).
  • Oil prices are down today, following equities lower as tensions escalate between China and the US over proposed tariffs. WTI crude is down 1.48% to $62.57 with Brent crude down 1.31% to $67.23 at the time of writing.