Yesterday afternoon, we saw reports that the US is on the brink of proposing a fresh round of trade talks with the US. It marks the first time since Trump’s tariffs came into play that the US has reached out to negotiate, rather than the other way round. It remains to be seen whether the proposal is an olive branch, but it certainly feels that way at the moment.
The outreach to Beijing is reportedly being led by treasury secretary Steven Mnuchin, which is both good and bad. The positive is that it is a step in the right direction towards reducing the risks of a full-blown trade war, but it is negative that Mnuchin might be going it alone. If Trump does not agree to a softening of the US approach, then it is unlikely anything will happen. We will have to wait and see.
It has been a relatively quiet week so far for US economic data, but today we will see the inflation rate for August. It is expected to dip a little to 2.8% from 2.9% the previous month. We will also see initial jobless claims up to 8 September 2018 – claims are expected to climb a little higher to 210,000. That said, recent releases mean it wouldn’t be a surprise to find claims have dropped further. Last time around, they hit their lowest mark since December 1969.
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