Chinese economic data for October to highlight growing impact of US trade tensions
Ahead of scheduled talks between Trump and Xi tomorrow, China will release economic data for the month of October today.
The trade war between Washington and Beijing has stalled in recent weeks, with both countries evaluating their next steps. It is clear that tensions have impacted their economies, with Chinese manufacturing growth hitting a two-year low and US exports of soybeans and automobiles severely reduced.
Today’s release will reveal a more detailed picture of how the trade war has affected China’s markets, with a Reuters poll estimating export growth at 11%. While this is still a healthy pace (only down 3.5% from September), businesses have likely frontloaded orders, expecting further tariffs come December.
Such a prediction is not unreasonable. Trump’s administration is reportedly gearing up to extend tariffs on $257 billion worth of remaining goods. However, do not discount the possibility of an agreement in tomorrow’s negotiations—or at least some preliminary understanding that may dissuade further tit-for-tat escalation. Indeed, if China’s October trade figures are worse than expected, Beijing may take a more conciliatory position.
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