New trade tariffs under a potential Trump 2.0 are a risk to exports, currently a key engine of growth. Still, trade diversion (through countries like Vietnam/Mexico) mitigates effects of trade tariffs over time. Meanwhile, domestic demand remains weak; we cut our 2024 growth forecast to 4.9% (from 5.1%), ABN AMRO Senior Economist Arjen van Dijkhuizen notes.
Beijing focuses more on the supply than the demand side
“As expected, quarterly GDP growth in Q2-24 slowed from an above trend pace of 1.5% qoq s.a. in Q1 to 0.7%, while annual growth slowed more than expected on revisions, to 4.7% yoy (Q1: 5.3%). We still expect some payback in Q3, but cut our 2024 annual growth forecast to 4.9%, from 5.1%.”
“Exports are currently a key driver of growth, although export growth slowed in July. What is more, China’s supply-focused strategy contributes to a broadening of trade spats, with the US/EU (and others) protecting strategic sectors against Chinese (over)supply. This risk would rise under a potential ‘Trump 2.0”. Trump threatens with a 10% universal tariff and higher (±60%), broader China-tariffs compared to his first tariff war in 2018-20.”
“So far, policy easing did not really ‘move the needle’, with Beijing focused more on the supply than the demand side. Policy rates were cut (further) marginally in July, but kept on hold in August. This ‘piecemeal’ easing takes place amidst weak loan demand, with lending growth coming down. Meanwhile, key focus of the CCP’s Third Plenum held in July was Xi’s (supply side) strategy of high-tech development, and self-reliance.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
![AUD/USD: Be careful with the 200-day SMA](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/AUDUSD/australian-currency-23690700_XtraSmall.jpg)
AUD/USD: Be careful with the 200-day SMA
AUD/USD plummeted to multi-day lows and threatened the 0.6700 region on the back of the pick-up in the US Dollar, while omnipresent concerns around China and lower commodity prices also added to the sour mood around the Aussie Dollar.
![USD/JPY tumbles on hawkish BoJ tone, firm below 146.00](https://editorial.fxstreet.com/images/Markets/Currencies/Majors/USDJPY/japanese-yens-7972406_XtraSmall.jpg)
USD/JPY tumbles on hawkish BoJ tone, firm below 146.00
The USD/JPY dropped late in the North American session, registering losses of over 0.80% or more than 100 pips. It now trades at 145.68. During the overnight session for US traders, headlines revealed that Bank of Japan (BoJ) Governor Kazuo Ueda reiterated his hawkish stance on remarks submitted to a government panel.
![Gold bounces from intraday lows, risks another leg south](https://editorial.fxstreet.com/images/Markets/Commodities/Metals/Gold/Gold_Bar_XAU_Precious_Metal_XtraSmall.jpg)
Gold bounces from intraday lows, risks another leg south
Gold continues to stretch lower on Tuesday and trades at its weakest level in nearly two weeks below $2,480. Although the US Treasury bond yields decline toward 3.8%, XAU/USD struggles to find a foothold amid persistent US Dollar resilience.
![XRP breaks past key resistance, Ripple announces plans for Ethereum-compatible smart contracts](https://editorial.fxstreet.com/images/Markets/Currencies/Cryptocurrencies/cryptos_XtraSmall.jpg)
XRP breaks past key resistance, Ripple announces plans for Ethereum-compatible smart contracts
Ripple (XRP), a cross-border payment remittance firm, made several key announcements in Japan and Korea on September 3. One of the key announcements was the plan for an Ethereum-compatible sidechain on the XRP Ledger.
![Week ahead: US labour data and the BoC rate announcement in focus](https://editorial.fxstreet.com/images/Macroeconomics/EconomicIndicator/Employment/NFP/working-america-gm173864680-9188844_XtraSmall.jpg)
Week ahead: US labour data and the BoC rate announcement in focus
With US Federal Reserve Chair Jerome Powell’s recent speech at the Jackson Hole Symposium confirming that it is time to begin easing policy as well as underlining the importance of the jobs market, this week’s jobs data may help determine how the Fed approaches its easing cycle.
![Moneta Markets review 2024: All you need to know](https://editorial.fxstreet.com/images/IT/Testing/Review/FXSBadgeCertifiedBackg_XtraSmall.png)
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.