During a Southeast Asian tour, Chinese President Xi Jinping advocated for free trade, portraying China as a stabilizing force amid global economic uncertainty. In Vietnam, he met with President Luong Cuong and General Secretary To Lam, emphasizing bilateral cooperation to maintain global trade and supply chains. Agreements were signed focusing on supply chain cooperation and agricultural exports, while Xi also addressed the ASEAN free trade agreement in Malaysia. The timing of the trip, coinciding with recent US tariff disruptions, allowed China to position itself as a reliable economic partner in the region.
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Investors are unexpectedly selling U.S. government bonds, a phenomenon worrying experts due to the potential for rising interest rates on loans and decreased confidence in the U.S. as a stable investment. This sell-off contrasts with typical behavior during economic uncertainty, where investors traditionally flock to Treasuries. Contributing factors include concerns about President Trump’s policies and the potential unwinding of leveraged trades. The situation is further complicated by the lack of a clear, single cause and the uncertainty surrounding its duration and ultimate impact.
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Amidst escalating trade tensions, Chinese President Xi Jinping declared China’s unwavering stance against what it terms “unilateral bullying” by the US, rejecting accusations of starting a trade war. China raised tariffs on US goods to 125%, but asserted this was a response to US actions and not a sign of further escalation. Xi engaged in diplomatic efforts with Spain and other nations, aiming to solidify alliances and present China as a reliable trading partner amidst global economic uncertainty. While China maintains it will not initiate further tariff increases, it has several alternative countermeasures available.
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John Q. Hosedrinker