Bloomberg Intelligence China Hits Back Against Trump Tariffs
Feb 4, 2025
RJ Gallo, a Senior Portfolio Manager at Federated Hermes, and Ernie Miller, CEO of Verde Clean Fuels, dive into the implications of China's strategic response to U.S. tariffs. They explore the balance between retaliation and diplomacy, examining effects on international trade. Gallo discusses rising yields and investment opportunities in bonds, while Miller highlights challenges in natural gas production and the shift to greener energy. Their insights reveal how political actions ripple through the markets and reshape energy policies.
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China's Measured Retaliation
- China's response to Trump's tariffs was measured and strategic.
- It signaled a willingness to negotiate while demonstrating the potential for further retaliation.
Potential for De-escalation
- The upcoming talks between Trump and Xi Jinping could provide an opportunity for de-escalation.
- Trump's history of hawkishness on China suggests the tariffs signal a strong intent.
Complex US-China Issues
- Unlike the clear fentanyl-related ask with Mexico and Canada, the issues with China are multifaceted.
- These include national security, IP protection, trade deficit, fentanyl, and China's global role.