And the market suffers. President Trump said he will increase tariffs on $200 billion in Chinese imports from 10% to 25% starting Friday.
The reason cited was an “erosion in commitments by China” said U.S Trade Representative Robert Lighthizer.
The problem is China doesn’t care what the reason is. They will most likely counter the US increase with increases of their own, making it harder and more expensive for US companies to do business in China, which in turn raises costs locally, which is why the stock market is for the second day in a row in negative territory.
Yesterdays losses were not as bad as they could have been, traders didn’t believe the hype… but every day closer to Friday will bring more uncertainty until a deal is signed or more news comes out.