US-China Trade Talks

With the trade war between the U.S. and China going in to its 19th month, the economy continues to be negatively affected. More talks are scheduled to continue this week on Thursday and Friday.

The Institute of Supply Management (ISM) published the index at 47.8%, which is below the growth point of 50% for September. Experts believe this is due to the uncertainty of the outcomes of the US/China talks. China has stated they do not want to agree to the broad trade deal that President Trump has suggested.

With the September 2019 tariff increase, the University College London and the London School of Economics estimate that the average American family will pay around $460 a year in additional costs. The new tariffs were put on frequently purchased products such as footwear and clothing. For bigger spenders this number could be as high as $970 a year.

The U.S. stocks have lightly declined this week. After close of the markets on Friday, six Chinese tech companies were blacklisted because of human right violations which will likely only increase tension between the two countries.

Despite the trade pressure, the economy keeps chugging along. The US Treasury yield was lightly up on Monday. The 10-year Treasury note yield rose 3.7 basis points while the 30- year bond yield rose 2.5 basis points. The 2 year note yield rose 6.6 basis points. The yield curve ended at 0.1% on Monday. The unemployment rate continues to fall to a historical 50-year low. Friday jobs report estimated it was at 3.5%. Also, the dollar has strength while the pound has slightly slipped.

Investors and politicos, alike, will be keeping their eyes on the news this week.