United States:
Trump Warns China Impasse to Worsen If Xi Retaliates on Tariffs
President Donald Trump threatened that the trade standoff with China will “get worse” if there is retaliation for U.S. tariffs that go into effect on Chinese goods Monday. “I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries,” Trump wrote in one of several Twitter messages. Trump’s comments come after high-level talks between Chinese and American officials broke up May 10 without a deal and ahead of an expected announcement Monday from U.S. officials detailing their plans to impose a 25% additional tariff on all remaining imports from China — some $300 billion in trade. As Beijing promised retaliatory measures, Chinese state media blamed the U.S. for a lack of progress in trade talks while emphasizing the country’s economic resilience. People’s Daily, the flagship newspaper of China’s Communist Party, said in a front-page commentary that the U.S. should take full responsibility for the setbacks because it went back on its word and imposed more levies on Chinese products. “That cast a shadow on the trade talks and directly led to the fruitless outcome” of trade discussions, the paper said. The ongoing trade fight between the world’s two biggest economies is roiling markets and weighing on projections for global growth.
UK:
London Housing Is Taking the Hardest Brexit Hit, Acadata Says
London’s property market is continuing to bear the brunt of Brexit malaise, according to a report from Acadata. House prices in the capital fell by 1.1% in April from a year earlier, the report showed. Nationally, they rose 0.2% in the period, to an average 302,122 pounds ($393,332). The number of property sales tell a similar story, At the national level, an increase over the past year, along with an uptick in first-time buyers, is “suggesting the market is growing — albeit slowly.’’ In London, however, sales are down 14% since the first quarter of 2017. The capital has been the most affected by the uncertainty surrounding Britain’s departure from the European Union, now scheduled for the end of October. Four regions in the south are experiencing falling prices while Wales, the Midlands and most of the north of England are all experiencing gains, the report said. Sellers in London are starting to drop prices to secure early sales, according to Acadata, echoing similar findings from the Royal Institution of Chartered Surveyors last week.
Asia:
China Defies Trump With Plans to Raise Tariffs on U.S. Products
China announced plans to raise duties on some American imports starting June 1, defying a call from President Donald Trump to resist escalating a trade war that is sending stock futures tumbling and clouding the outlook for the global economy. Less than two hours after Trump tweeted a warning that “China should not retaliate — will only get worse!” the Ministry of Finance in Beijing announced the measures on its website. The new rate of 25% will apply to 2,493 U.S. products, with other goods subject to duties ranging from 5% to 20%, it said. S&P 500 futures were down about 2 percent just before 9 a.m. in New York, while Treasuries rallied with the yen on demand for for haven assets. The salvo came in response to the U.S.’s decision last week to increase tariffs on $200 billion in Chinese imports to 25% from 10%. Trump on Monday accused China of backing out of a deal that was taking shape with U.S. officials, saying Beijing reneged on an agreement to enshrine a wide range of reforms in Chinese law. “I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don’t make a deal because companies will be forced to leave China for other countries,” Trump wrote on Twitter. “You had a great deal, almost completed, & you backed out!” Both the U.S. and China had tried to project calm since the latest round of discussions ended on Friday and said that they plan to continue negotiations in the hopes of avoiding a tumble in markets and broader economic damage. But that facade masks fundamental divisions, with U.S. officials increasingly convinced that hardliners in Beijing are winning the internal debate on reforms.