While global equity futures continue to soar amid a return of the “coronavirus is contained” following reports that new drugs are in the pipeline to treat the deadly disease on Wednesday, China’s economy is expected to print sub-5% GDP in Q1. This has forced an increasingly desperate Beijing to unexpectedly announce on Thursday that it will slash tariff levied on 1,717 U.S. goods by up to 50%.
China’s finance ministry stated that on Feb. 14, additional tariffs levied on some goods will be reduced from 10% to 5%, and others lowered from 5% to 2.5%, reported Reuters. The finance ministry didn’t explicitly state the value of goods affected by tariff reductions.
In a separate statement, the ministry said tariff reductions would mostly be for products announced during the trade war. They said further tariff adjustments could depend on the bilateral economic and trade situation.
The ministry said soybean tariffs would be reduced from 30% to 27.5%. Tariffs on crude will be halved from 5% to 2.5% after Feb. 14.
While global equity futures continue to soar amid a return of the “coronavirus is contained” following reports that new drugs are in the pipeline to treat the deadly disease on Wednesday, China’s economy is expected to print sub-5% GDP in Q1. This has forced an increasingly desperate Beijing to unexpectedly announce on Thursday that it will slash tariff levied on 1,717 U.S. goods by up to 50%.
China’s finance ministry stated that on Feb. 14, additional tariffs levied on some goods will be reduced from 10% to 5%, and others lowered from 5% to 2.5%, reported Reuters. The finance ministry didn’t explicitly state the value of goods affected by tariff reductions.
In a separate statement, the ministry said tariff reductions would mostly be for products announced during the trade war. They said further tariff adjustments could depend on the bilateral economic and trade situation.
The ministry said soybean tariffs would be reduced from 30% to 27.5%. Tariffs on crude will be halved from 5% to 2.5% after Feb. 14.
Two-thirds of China’s economy is offline, which will produce an economic “shock” that will send GDP tumbling sub-5% in 1Q.
An economic “shock” in China will likely spill over into the rest of the world in the quarter. The reason: China’s economy has significantly increased in importance since the 2003 SARS epidemic because of the breathtaking growth of the Chinese economy over the past two decades.
Finally, those wondering why China would hint at major weakness by proactively pursuing such a move that puts it at a tactical disadvantage with the US, well that’s the $64 trillion question, and the answer appears to be viral.
https://twitter.com/NorthmanTrader/status/1225325026515312640?s=20
This article appeared at ZeroHedge.com at: https://www.zerohedge.com/markets/china-slash-tariffs-some-us-imports-amid-economic-shock