Sep 02, 2019
Brexit Pressure As the US-China Trade War Heats Up
After being on a break, the UK parliament is expected to open tomorrow and the British pound (GBP) is expected to respond accordingly. That is, if no news is released tomorrow regarding the Brexit plan, negative pressure will increase, thereby pushing the GBP even lower.
Meanwhile, in other financial news, the US-China trade war is heating up. Today, additional tariffs were added to a variety of over $100 billion worth of Chinese products that are imported to the USA. These products included footwear, clothing and electronics. A 15% tax has been to these products making it more expensive for US consumers who are purchasing these Chinese products.
Today, the US stock market is closed as a result of Labor Day and so, investors will need to wait over 24 hours in order to see what impact this increased tax has had on stock prices. This wait and the growing tensions between the US and China are clearly pushing up the market pressures.
There does not, however, seem to be an end to the trade tensions and starting on the 1st of October and the 15th of December, more taxes will be added. If the trade war between the US and China is not resolved, and each country simply keeps raising taxes on each other, business confidence will be negatively impacted, which will also cause a drop in the stock market.