Danske Bank analysts note that the US and China both announced on Friday that a phase-one deal had been reached, which marked a shift from escalation to de-escalation.
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“While this is good news, the unorthodox process of the announcement and the mixed signals from each side suggest that things are not smooth behind the scene.”
“The next thing to watch for is the finalisation of the legal text and signing in early January. Then the two sides move on to phase-two, which will prove more difficult.”
“With the US election getting closer, however, we do not expect to see another round of escalation in 2020. But we should expect some bumps on the road, still.”
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