US-China trade conflict to remain in focus – Danske Bank

This week's focus will continue to be on the US-China trade conflict, where uncertainty increased on Friday as Trump ordered his administration to consider tariffs on an additional USD100bn worth of Chinese imports, suggests the research team at Danske Bank.

Key Quotes

“Yesterday, Trump tweeted that 'President Xi and I will always be friends, no matter what happens with our dispute on trade. China will take down its Trade Barriers because it is the right thing to do. Taxes will become Reciprocal & a deal will be made on Intellectual Property. Great future for both countries!' This might be seen as a sign of it all ending with a deal and hence be interpreted positively by the markets.”

“We still believe that the ultimate outcome of the trade conflict will be one of a negotiated solution and do not expect an all-out trade war. However, it seems things could get worse before they get better.”