AP Photo/Andrew Harnik
- Progress toward a trade deal stalled last month after the US said China reneged on major commitments.
- Tensions between Beijing and Washington have steadily risen since then.
- That has left some bracing for the possibility that tariffs could remain in place for a prolonged period of time and be expanded to a broader range of products.
Tensions between Beijing and Washington have steadily risen since a breakdown in negotiations in May, dimming hopes for a detente between the largest economies as they remained mired in an escalating trade war.
That has left some bracing for the possibility that tariffs could stay in place for a prolonged period of time and be expanded to a broader range of products. Last month, progress toward a deal stalled after the US said China reneged on major commitments.
"Stock markets and companies were betting that a lot of the bluster could be a negotiating tactic, and we were setting ourselves up for a resolution of this year long trade war," said Brian Keare, the field chief information officer at the data analytics software startup Incorta.
"But I think instead what we got was a game-changing increase in the tariff rate and a realization from thousands of companies that hope is no longer a strategy and that we could be in this for the long haul," added Keare, who advises businesses like Broadcom, Starbucks, and Apple.
The Chinese government issued travel warnings for the US on Tuesday, saying its citizens had been subject to what it called harassment by American law enforcement. A separate alert from the Chinese Ministry of Culture and Tourism added that shootings and theft had become frequent there.
A Foreign Ministry spokesman also condemned the US in a statement after Secretary of State Mike Pompeo called on the Chinese government to publicly acknowledge the anniversary of the deadly crackdown at Tiananmen Square in 1989, saying his statement amounted to interference in its internal affairs.
That came after the US Trade Representative late on Monday pushed back against a government report from Beijing, which had blamed the trade war on Washington.
"The United States is disappointed that the Chinese have chosen in the ‘White Paper’ issued yesterday and recent public statements to pursue a blame game misrepresenting the nature and history of trade negotiations between the two countries," the USTR said.
In a statement at monetary-policy conference in Chicago on Tuesday, Federal Reserve Chairman Jerome Powell signaled the central bank was ready to take action if trade conditions worsened.
"We are closely monitoring the implications of these developments for the US economic outlook and, as always, we will act as appropriate to sustain the expansion," he said of trade negotiations.
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Source: Business Insider – gheeb@businessinsider.com (Gina Heeb)