By Jon Dougherty
(NationalSentinel) Markets in Europe, the U.S., and Asia either rallied or, in the latter case pared losses, on positive indications from China that Beijing is in “effective contact” with Washington regarding trade talks that are tentatively scheduled for September.
The Chinese Yuan soared while Treasury yields jumped following a statement from China’s Commerce Ministry spokesman Gao Feng, who said that both U.S. and China trade teams have been in touch.
Gao claimed that China has ample retaliatory measures and are lodging solemn representations with the U.S. over the additional tariffs.
Still, “both sides are discussing the September talks and if China officials go the the US then there should be an environment created for progress in the negotiations; calls on the US to cancel the planned additional tariffs to avoid a trade war escalation,” Zero Hedge reports, adding:
As a result, S&P 500 contracts turned sharply higher, rising 0.7% alongside the 1% move higher in Stoxx Europe 600 Index, just around 3am when China’s commerce ministry spokesman said escalating the trade war won’t benefit either side, and that it was more important to discuss removing the extra duties.
The news comes amid economic and employment declines in Europe’s biggest economy, as well as in China. German manufacturing continues to fall as more than 4,000 people were added to the ranks of the 2.29 million unemployed, the fourth straight month of decline. In all, German manufacturing has been slowly but steadily declining for about six years.
Meanwhile, The Epoch Times reports that Chinese factory output has also fallen for the fourth straight month, which is largely due to the ongoing trade war with the United States:
Factory activity in China is expected to have contracted for the fourth straight month in August, a Reuters poll showed, as the United States ratcheted up trade pressure and domestic demand remained sluggish.
The official Purchasing Managers’ Index (PMI) for August is expected to be unchanged at 49.7 from July, according to the median forecasts of 27 economists, but remain below the 50-point mark that separates expansion from contraction on a monthly basis.
Further signs of contraction, following surprisingly weak July data, would add to views that the world’s second-biggest economy is continuing to lose momentum. […]
The yuan has lost more than 3 percent of its value against the dollar since Trump announced more tariffs on Aug. 1, and has weakened about 12 percent since Washington unveiled China-specific levies in April last year.
But that has not helped Chinese exporters much, as global demand has weakened at the same time.
At the same time, the U.S. economy is expanding. In July CNBC reported that the expansion is now the longest in history:
This month marks the 121st month of the economic expansion arising out of the great financial crisis, making it the longest run on record going back to 1854.
This cycle, starting in June 2009, breaks the record of 120 months of economic growth from March 1991 to March 2001, according to the National Bureau of Economic Research.
Unemployment in the U.S. is at 3.6 percent, the lowest level since 1969. And yet, Obama sycophants like Steven Rattner, a former counselor to Treasury during 44’s term, are still trying to claim Trump’s massively improved economy really belongs to his predecessor.
Revisionist history is not real history.
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