Bloomberg Surveillance Bloomberg Surveillance TV: June 3, 2025 (Podcast)
Jun 4, 2025
Andy Barr, the Republican Congressman from Kentucky, dives into pressing economic issues, including the national deficit and strategic competition with China. He discusses the implications of government defense spending on economic growth and productivity, while also addressing current fiscal policies impacting inflation. Barr emphasizes the need for bipartisan reforms to foster competitiveness and navigates the complexities of the U.S.-China relationship, shedding light on investment challenges and the importance of stability in global markets.
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China's Hesitation on US Call
- China hesitates on a phone call with Trump fearing it might weaken their stance and leverage in the relationship.
- Beijing waits for a stronger bargaining position before agreeing to talks despite the simplicity of arranging a call.
Yuan-Dollar Relationship Explained
- The yuan is pegged to the dollar, so a weaker dollar tends to pull the yuan down too.
- China prefers a mild appreciation bias for the yuan even if the dollar weakens overall.
China Investment Requires Edge
- Institutional investors face risks in China due to political and market complexities.
- Investing in China requires having a significant edge given tariffs, export controls, and new challenges.