24th August 2018
A Gentle Decleration?
The week has been good US tech giants, not great for Chinese and Hong Kong stocks, and choppy for UK and European companies. Donald Trump upped the ante in the trade war with China; China responded in a measured way that could be read as political nous, but is likely to read as economic weakness by its rival.
The BoE and the Housing Market
The Bank of England (BoE) raised interest rates to their highest level in nearly 10 years on Thursday. The bank’s Monetary Policy Committee (MPC) voted unanimously to put rates up to 0.75%, saying that recent data had vindicated their view that the UK’s slowdown in the first quarter of this year was only temporary.
Central bank watch: US on hold, Japan tweaks and BoE hikes by 0.25%
Central banks are back in the news this week, despite not doing anything wildly unexpected, which led to a relatively muted market reaction. But they continue to hold importance for investors, so their actions and statements are closely followed.
War on China!
The US’s trade war on China cranked up another notch this week. In typical tit-for-tat fashion, the Trump administration proposed a 25% tariff on $200bn of Chinese goods on Wednesday. The increase from the previous 10% tariff is, according to Trade Representative Robert Lighthizer, because of China’s retaliatory actions and refusals to meet US demands.
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