Sunday , May 16 2021

The truce agreed in Buenos Aires strongly reacted to Wall Street

Presidents of the United States and China, Donald Trump and Xi Jipping, they were optimistic after today after the truce they sealed in Buenos Aires on Saturday night, an agreement that already has its first concrete result: a major rise in Wall Street's major indices.

Although the tensions still persist, the new climate between the leaders of the two largest economic powers in the world had the first concrete result in Wall Street, it opened today with strong profits and Dow Jones from the industry, its main indicator, is one of the greatest increases of the last time and made little reassurance to international investors, who are still pushing for a definite deal, that we really rejected the specter of commercial warfare.

The New York stock market has made considerable progress last week, reacting with optimism about the progress of negotiations in the US-China negotiations and gaining a slight change in tone from the Federal Reserve authorities: Dow Jones (+5, 16%) has seen its highest weekly growth since 2016 year, and Nasdaq (+ 5.64%) and S & P 500 (+ 4.85%) from 2011.

"Relations with China have made a big step forward, many good things will happen, we negotiate with great power, but China also has much to gain if and when the deal is completed, let's balance the playing field!" Trump promised on his Twitter account.

"President Xi and I have very strong and personal relations; he and we are only two people who can achieve a massive and very positive change in trade and much more, between our two great nations," he said. several days after a bilateral summit in which they signed an agreement to end the three-month escalation of Tarrap's tariffs that began in the middle of the year.

So optimistic was the US president after dinner in Buenos Aires, who already talks about a possible deal with China and Russia to prevent another escalation worrying the world, the military.

"I am sure that at some point in the future, President Xi Jinping and I, together with President Vladimir Putin, will begin to talk about a significant brake on what has become a huge and uncontrolled arms race," he said. on your Twitter.

From Panama, his last trip to Europe and Latin America, Xi again pledged to fight "protectionism" and "open" global economy, but he avoided mentioning the US or Trump.

At a joint press conference with Panama President Juan Carlos Varela, the Chinese president ratified his role as the new world free trade leader and committed itself "to jointly face the challenges of protectionism, promote the release of trade and investment, and promote building an open world economy ".

History of conflict

This war began in July last year, when the United States introduced tariffs for Chinese goods worth $ 250,000 million.

Later, Trump threatened to apply similar measures for another 267,000m euros, which would exceed the value of purchases in China, which in 2017 reached the amount of 506,000m dollars.

In retaliation, China applied tariffs for US products for more than $ 60 billion, nearly half the $ 130 billion, which cost their purchases in the United States last year.

An agreement closed last Saturday suspended for 90 days the US decision to increase from 10% to 25% import tariffs to hundreds of Chinese products.

Despite this progress, fundamental tensions still exist.

Trump has accused China of stealing US technology and demanding that it open up its market for American products and end the requirement for foreign companies to cooperate with Chinese companies for work.

The Republican president has condemned his country's huge trade deficit with China, which last year reached $ 336,000 million and wants Beijing to allow its currency to float in order to provide the expected yuan's appreciation.

China refuses, because the artificially devalued yuan receives great competitive advantages over the United States.

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