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Following the US President Trump’s Tweet threatening to raise tariffs on China this Friday, the Goldman Sachs analysts came out with a note, citing that it sees a 40% chance of the US raising the tariffs from 10% to 25% on the Chinese imports.

Key Quotes:

“BOTTOM LINE: President Trump’s announcement that the tariff rate on $200bn of imports from China will rise from 10% to 25% lowers the odds of a successful conclusion to US-China trade talks and raises the odds of further tariff escalation.

However, we think it is more likely that the increase will be narrowly avoided and believe the odds of tariffs increasing on Friday are 40%.”