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Anxiety over Donald Trump’s plan to announce a barrage of tariffs on trading partners next week is gripping the global economy, and the markets.
China’s president Xi Jinping has gathered a group of top chief executives in Beijing today, where he urged them to protect industrial and supply chains, as the trade war with the US deepens.
The gathering includes AstraZeneca’s boss Pascal Soriot, Bill Winters of Standard Chartered, Bridgewater’s Ray Dalio and Stephen Schwarzman of Blackstone, plus the CEOs of FedEx, Saudi Aramco, Toyota, Mercedes-Benz, HSBC and Hitachi.
Xi urged the assembled bigwigs,
“We need to work together to maintain the stability of global industrial and supply chains, which is an important guarantee for the healthy development of the world economy”
Around 40 executives joined the meeting, held at the Great Hall of the People in Beijing, Reuters reports.
Xi told them that overseas firms play an important role in China’s economy:
“Foreign enterprises contribute one-third of China’s imports and exports, one-quarter of industrial added value and one-seventh of tax revenue, creating more than 30 million jobs.
And he took a swipe at the trade barriers imposed by other countries in recent years, saying:
“In recent years, foreign investment in China has also been interfered with by geopolitical factors… I often say that blowing out other people’s lights does not make you brighter.”
The meeting comes less than a week before Trump’s “Liberation Day”, when he is expected to announced a wide-ranging slate of reciprocal tariffs. That could disrupt global trade flows, and push up the cost of imports to the US.
Asia-Pacific stock markets have dropped today, with China’s CSI 300 down 0.44% and South Korea’s Kospi losing 2%.
Auto companies contined to be hit by the 25% tariffs announced by Trump on Wednesday, with Hyundai Motors falling another 3.5% today.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank, says sentiment remains sour due to intensifying tariff talk.
The carmakers around the world got hammered this week as the ones that produce their cars outside the US will cost 25% more if the levies go live – and nearly half of vehicles sold in the US are reportedly assembled elsewhere – and, the ones that are made in the US have at least 20% of their components coming from outside the US.
Evercore ISI predicts that US car prices will likely increase by $3000-4000 on average.
The agenda
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7am GMT: UK GDP quarterly national accounts, October to December 2024
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7am GMT: GB retail sales report for February
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12.30pm GMT: US PCE inflation report for February
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2pm GMT: University of Michigan’s US consumer confidence report
