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CNH: USD/CNH Lower As Trump States He Would Rather Not Have To Use Tariffs

CNH
EM BulletAPACChinaEmerging Market NewsBulletMarketsFixed Income BulletsForeign Exchange Bullets

USD/CNH is down sharply to sub 7.2700. We got to lows of 7.2630, but sit slightly higher now. headlines have crossed from Trump's interview with Fox News. 

  • Trump noting that his conversation with China's Xi went well. He stated he can make a deal with Xi in relation to trade issues, although noted the US lost US1trln to China last year (presumably in reference to the trade deficit).
  • He also stated he would rather not have to use tariffs on China. This remark has likely generated most of the market's positive response. This is likely help temper market concerns around a Feb 1 hike in tariffs.
  • Still, earlier remarks from Trump in the interview highlighted the 1800's period when the US used tariffs and that this was the US's richest period. So it's likely tariffs still remain part of his playbook. 
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USD/CNH is down sharply to sub 7.2700. We got to lows of 7.2630, but sit slightly higher now. headlines have crossed from Trump's interview with Fox News. 

  • Trump noting that his conversation with China's Xi went well. He stated he can make a deal with Xi in relation to trade issues, although noted the US lost US1trln to China last year (presumably in reference to the trade deficit).
  • He also stated he would rather not have to use tariffs on China. This remark has likely generated most of the market's positive response. This is likely help temper market concerns around a Feb 1 hike in tariffs.
  • Still, earlier remarks from Trump in the interview highlighted the 1800's period when the US used tariffs and that this was the US's richest period. So it's likely tariffs still remain part of his playbook.