China Retaliates Against US Tariffs, RBA Reveals Local Concerns
China has reacted swiftly to the US Government’s latest round of $US200 billion in tariff moves, announcing it will impose tariffs of its own on another $US60 billion worth of US imported goods, including a 10 per cent tariff on LNG.
State newspaper The China Daily yesterday warned the Trump Administration that it would be making a “serious mistake” if it attempted to force China to make serious trade concessions through tariffs. It also said that President Trump’s protectionist measures would backfire on him, harming US industries and the American people.
“The trade conflict will not force China to succumb to US pressure,” it said. “Instead, given its economic resilience, it will squarely face those challenges, find the right solutions and emerge stronger.”
Adding fuel to the fire, foreign affairs spokesperson Geng Shuang said Beijing was being forced to “safeguard its legitimate and legal rights and interests and uphold the global free trade order. We hope the US will realise the negative consequences of its actions and take credible means to correct them in a timely manner.”
The new Chinese tariffs are due to come into effect on September 24.
Meanwhile, the RBA has identified the escalation in the US-China trade conflict as a material risk to the Australian economy.
Minutes from the organisation’s September board meeting, released today, show global trade tensions were raised by several board members during the meeting.
“Members observed that there were still significant tensions around global trade policy and that this represented a material risk to the outlook,” the minutes said.
The RBA did, however, remain cautiously optimistic about the state of the Australian economy.
“Based on the forecasts and associated risks, members assessed that the current stance of monetary policy would continue to support economic growth and allow for further progress to be made in reducing the unemployment rate and returning inflation towards the midpoint of the target,” the minutes showed.