The New York Post reports that the US is weighing a plan to slash China tariffs to as low as 50% next week from 145%.
“US officials are discussing a proposal to lower President Trump’s punishing levy on China goods to between 50% and 54% as they begin what promise to be lengthy talks to hammer out a trade agreement, sources close to the negotiations said”
Tariffs on neighbouring south Asian countries would be cut to 25%.
It’s crazy how much of this already appears to have leaked:
In response, a “whisper” campaign spread quickly and “the number that emerged to get the ships flowing out of China was 54%,” said Jay Foreman, CEO of Basic Fun, which makes its retro toys in China including Tonka Trucks, Care Bears and My Little Pony.
“The signals we are getting is that the dam will break by the end of this week or next, that there will be an adjustment,” Foreman told The Post.
Accordingly, many retailers already have begun asking vendors to quote prices based on a range of tariff rates — anywhere between 10% and 54% — “so they are ready to price when the goods land” in the US, Foreman added.
If you don’t have insider information, this market is tough to trade.
“The retailers behavior changed after the White House meeting as if they got some confidence,” said retail guru Gerald Storch, a former CEO of Toys R Us and Canadian based department store company HBC.
The S&P 500 took quite a jump that day.
Earlier today Trump said to ‘buy stocks’ and plenty of people did because it was reminiscent of his message a few hours before he removed the reciprocal tariffs.
This article was written by Adam Button at www.forexlive.com.
