China a Currency Manipulator? Trump Says Never Mind
Not that it technically was one. But markets welcomed the de-escalation.
A symbolic gesture helps lower the heat in a trade standoff.
Photographer: Bloomberg/BloombergIt took President Donald Trump about two-and-a-half years to designate China a currency manipulator, thereby fulfilling one of his key campaign pledges – and only five months after that to effectively say “never mind.” Just like back in August, when the Treasury Department foisted the label on China in the heat of the escalating trade war, the decision by the U.S. to reverse its stance should be viewed as more symbolic than meaningful for financial markets. But it’s something.
A tamping down of the rhetoric from both the U.S. and China on the trade front as they worked toward a “phase-one” accord helped to prople equities higher in recent months. So it stands to reason that market participants will welcome any further moves seen as a de-escalation of the trade war. Indeed, stocks reached their highs of the day following the news, adding to gains of anywhere from 14% to 16% for the U.S., China and worldwide since early August.