December 13, 2019
Trump Signs Off on China Trade Deal to Avert December Tariffs
“President Donald Trump signed off on a phase-one trade deal with China, averting the Dec. 15 introduction of a new wave of U.S. tariffs on about $160 billion of consumer goods from the Asian nation, according to people familiar with the matter. The deal presented to Trump by trade advisers Thursday included a promise by the Chinese to buy more U.S. agricultural goods, according to the people. Officials also discussed possible reductions of existing duties on Chinese products, they said. The terms have been agreed but the legal text has not yet been finalized, the people said. A White House spokesperson declined to comment.”
Johnson Wins Crushing Majority in Election That Upends Britain
“Boris Johnson won an emphatic election victory that redraws the political map of Britain and gives the prime minister the mandate he needs to pull the U.K. out of the European Union next month. The result spectacularly vindicated Johnson’s gamble on a snap election to break the deadlock in Parliament over Brexit, as his Conservatives won their biggest majority since 1987 under Margaret Thatcher. The pound rose by the most in almost three years as the scale of the Tory victory became clear. The outcome was a repudiation of the main opposition Labour Party under Jeremy Corbyn and his radical program of state intervention, nationalization of industries and tax rises for the better off. Corbyn announced his intention to resign after a catastrophic run of losses to the Tories in Brexit-supporting districts in northern England and Wales. These areas were considered traditional Labour strongholds and Johnson’s success here was the breakthrough that secured his victory.”
China Economists See Stability, Not Stimulus Push in 2020
“The Chinese government’s annual economic policy meeting which concluded Thursday signals a continuation of the current moderate stimulus strategy with only fine-tuning likely, economists said. Policy makers pledged to keep next year’s economic growth “within a reasonable range,” highlighting the need to achieve its goal of “building a moderately prosperous society” in 2020. Economists including Lu Ting at Nomura International Ltd in Hong Kong expect that the annual economic growth target will be trimmed to “about 6%” when it is released early next year. “We expect China’s 2020 policy stance to resemble that of 2019, with a significant focus on fiscal policy to prevent a sharper economic slowdown,” said Marie Diron at Moody’s Investors Service in Singapore. “The effectiveness of fiscal stimulus in supporting growth will be hindered by the rising risk aversion of banks, companies and households, in light of heightened uncertainty around the pace and composition of China’s economic growth.” ”
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