Cool Video: Let’s Not Declare Trade War Yet

by
Marc Chandler
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Trade tensions have risen. No doubt about it, but to consider this a trade war is premature.  We should not pretend that this is the first time that the US adopted protectionist measures that ensnarled are military allies.

We have been to this dance before. Countries will respond with some symbolic retaliation on a small number of goods that make a little more than a rounding error in bilateral trade, take some measures to ensure that the defection of the US does not lead to an import surge, and appeal to the conflict resolution mechanism at the WTO.

Being in Hong Kong as this two-week business trip winds down, I had the privilege of visiting with Yvonne Man at Bloomberg and tried to lay out this less emotive read of developments. Here is a 90-second clip.

In terms of the price action, the dollar was slipping through the JPY105 level in early Asian turnover. I suggest to Yvonne that a convincing break of it would target JPY100.

About Marc Chandler

He has been covering the global capital markets in one fashion or another for more than 30 years, working at economic consulting firms and global investment banks. After 14 years as the global head of currency strategy for Brown Brothers Harriman, Chandler joined Bannockburn Global Forex, as a managing partner and chief markets strategist as of October 1, 2018.

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