Trump trade policy risks - AmpGFX

Analysts at Amplifying Global FX Capital explains that while the market appears more sanguine on Trump’s trade policy disrupting resurgent global trade, tougher USA trade policy aimed at boosting US industry fits with the Trump focus on delivering for his true believers.

Key Quotes

“Somewhat lost in the focus on French elections, Trump threatening to introduce tariffs on steel imports.  Trump announced last week a national security investigation on steel imports. Trump said, “Steel is critical to both our economy and our military. This is not an area where we can afford to become dependent on foreign countries”. (FT 20 April)”

“A tariff on steel imports would appear aimed at reducing imports from China, and it may undermine confidence in the Chinese steel industry, where the government is already dealing with over-capacity.  There may also be a fallout to suppliers of steel-making material to China – Australia.”

“US Commerce Secretary Wilbur Ross has been meeting with the three big US Trade deficit countries, China, Japan and the EU.  Dealing with the USA deficit may return as one of the main policy issues for the Trump administration.  It plays well with Trump’s main support base.”