Last Thursday, President Trump asked the US Trade Office (USTR) to consider raising the 10%tariff rate of 10%of the 10%tariff on Chinese products to $ 25%.
In response to this, the Chinese government imposed 25%, 20%, 10%, and 5%tariffs ranging from US $ 60 billion of goods native to the United States last Friday.The effective time will depend on the next move of the United States.
The latest list covers 5207 tax items, and the list of US $ 50 billion in a 25%tariffs issued by China has not been repeated.Almost all other export products such as appliances, chemicals, etc.
Although not countermeasures to equate, further upgrade of trade disputes
Although the Chinese list is not an equal countermeasure, the list of lists announced by the Chinese side is wider and weakened, which undoubtedly has further upgraded the Sino -US trade dispute.We believe that since June, the risk of upgrading trade disputes to a comprehensive trade war has risen significantly.Trump has said that he has been "ready to Andrdquo; tariffs on all US $ 507 billion in Chinese imports.
UBS's US team believes that Trump has almost completely controlled trade negotiations. If he thinks that it should impose a 25%tariff on US $ 250 billion in Chinese imports, the US Trade Office can find enough evidence to support this judgment during the year.The U.S. government seems to have determined that raising tariffs is the only way to force China to concessions or begin to reduce the trade deficit.
However, although China is willing to make a certain compromise, it is unwilling to be the only Republican side in Sino -US trade friction, especially considering that the export of the United States accounted for 1/5 of China ’s total exports, facing two -digit tariffs imposed on the US export, facing double -digit tariffs on tariffs on double -digit tariffsIn the case, reducing the trade deficit in this way is at most the possibility of existence in assumptions.
If the United States increases a 25%tariff on China $ 250 billion in products, it will affect geometry?
The U.S. Trade Office will postpone the deadline for investigations and soliciting public opinions to September 5th, but we have assumed that we have assumed that the US $ 200 billion of Chinese products will be imposed on US $ 200 billion in the forecast of China ’s GDP growth of 6.2%in 2019Effective at the end of September.
Earlier, if the tariffs that are currently intended to increase in the United States (25% x 50 billion US dollars+ 10% x 200 billion US dollars) will bring more than 0.5% of China's GDP growth through direct and indirect channels (the first 12 of the first 12 (the first 12 of the 12sThe impact of the month), even if considering the support of domestic policies, the decline in GDP growth may exceed 0.3%.
If the U.S. will increase the tariff rate of US $ 200 billion in Chinese products to 25% (25% x 50 billion US dollars + 25% x 200 billion US dollars), the drag on GDP growth in the next 12 months may exceed 0.8%.
However, in this case, the easing policy is expected to further increase, partly offset an external impact and supports the growth of more than 6%of GDP in 2019.China ’s import plus tariffs on imports from the United States may push up the domestic CPI, but the downward proceeds on oil prices caused by the Sino -US trade war will completely offset or even exceed the former.
In addition, in this case, the exchange rate of the RMB against the US dollar at the end of next year may break 7. This is not from China to take the initiative to depreciate the renminbi or sell the US debt as a tool for the trade war (unless the full trade war erupted), but because the trade warUpgrade, even if the central bank has focused on maintaining the exchange rate is basically stable, the pressure of the RMB depreciation will inevitably rise.
It is worth noting that last Friday, the central bank reappeared the foreign exchange risk reserve rate of the long -term foreign exchange sales business to 20%(to combat speculation), and there were signs of stability in the shore and offshore markets.
One -handed counterattack, one -handed restriction
If the United States no longer further upgrades the tariff policy, we believe that China will avoid introducing countermeasures of the same scale.Before the United States further Andrdquo; before the teeth and teeth; before the teeth; before the teeth;
In fact, the pace of China's opening to the outside world has accelerated significantly in recent weeks. In addition to opening up automobiles and financial industries to foreign investors (such as foreign individual investors may be able to participate in the RMB A -share market through domestic securities firms), aviation, electronics,Business, food, beverage and other industries have also announced a number of news that set up joint ventures.
In addition to proposing a good job of deleveraging and deepening reforms, the Politburo Meeting held on July 31 also clearly required the protection of the legitimate rights and interests of foreign -funded enterprises in China, which shows that China will not punish US companies in China in a targeted manner.
In order to promote a number of domestic reform measures and protect China's core interests at the same time, it is expected that the government will continue to carefully manage market expectations (such as balanced policies and fine -tuning and promotion of deleveraging.Reverse cyclical adjustment factor).At the same time, the government will try its best to avoid worsening the situation to a comprehensive trade war.
Where to go next?The situation has not yet developed to an irreparable point, but the conflict has undoubtedly went further.There is such a risk in the future: the US government continues to be desperate, forcing China to meet all the requirements of the United States without making any concessions. China rejected and caused the United States to continuously increase tariffs and cover all imported products in China.
In view of the fact that both countries seem to be willing to resume negotiations and the possibility of avoiding further upgrading of the trade war, if only one party is willing to compromise, the possibility of positive results in the short term will be very low.Stress (for example, the United States continued to impose tariffs after the last time China made concessions).
The biggest dragging on the trade war on my country's macroeconomics is the second round of the economy through the channels of corporate investment and residents' consumption, including the uncertainty of the constant heating of trade frictions, and the growth rate of corporate decisions, profits and revenue growth rates. Impact.In the previous report, we defined the Andrdquo of the "full trade war andrdquo; as China and the United States increased high tariffs (such as 30%) to all export products between China and the United States, and issued non -tariff restrictions, which will seriously drag the Chinese economy.Growing.
However, in the situation of comprehensive trade war, if China has introduced loose and fine -tuning measures, and the slowdown of global trade activities may be less than our previous assumptions (if European and American trade negotiations have made more progress), the full trade war on the actual growth of growthImpact may be less than our expectations.
