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Richard Koo is chief economist at Nomura Research Institute explained that Trump’s hardline trade measures are “just the beginning”.

Key Quotes:

“This tariff tit-for-tat has plunged the world’s two largest economies into a trade war, and other countries are now monitoring the situation nervously.”

“Stocks in Shanghai are already down more than 20% from their recent peak in January, and the Chinese currency has fallen more than 4% against the US dollar in the month and a half since late May.”

“Share prices in other markets have also slumped. Additionally, companies around the world now face great uncertainty as they decide which countries to invest in and how to establish and maintain a global supply chain”

“When visiting Washington in May, I was told by a Republican foreign policy veteran that the protectionist economic policies announced by the Trump administration were “just the beginning.” Developments since then have reminded me repeatedly of that remark.  Mr.  Trump’s threat to impose punitive tariffs on an additional $200bn in imports from China in the event of further retaliation underscores the fact that this is “just the beginning” of a full-blown trade war.”