Trade war pushes China into current account deficit

The biggest damage from a renewed trade war with the United States will be China's swing from 25 years as a net domestic saver to a global net borrower. More than $1 trillion in stock value was wiped out on Monday due to the collapse of the expected U.S.-China trade deal.  The American government mostly ignored the 600-point drop in the Dow Jones Industrial Average and soybean futures hitting an 11-year low, but China's central bank was forced to inject $3.5 billion into the financial system after foreign investors dumped a record $1.6 billion's worth of mainland shares and its yuan currency fell to its lowest exchange rate to the dollar in four months. U.S. stock markets on Tuesday recaptured half of Monday's plunge as new data showed that tariffs on China have resulted in deflationary import prices, and President Trump backed his base by granting farmers another $15 billion in aid to offset China tariff...(Read Full Post)
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