The ongoing trade standoff between the U.S. and China is proving more unpredictable by the day. On Friday, financial markets tanked after the latest blowup between the nations brought heated rhetoric and new tariff threats. After China announced new tariffs on U.S. goods, President Trump encouraged U.S. business to pull out of the Chinese market and announced new U.S. tariffs on Chinese imports.
But Monday brought a softer tone, with President Trump telling reporters at the G7 summit in France that China wants to return to the negotiating table, and that he still believes the two sides can reach a deal. Chinese Vice Premier Liu He struck a similar note, saying China is willing to resolve the trade dispute through "calm" negotiations.
All of the back-and-forth and market volatility has left some businesses nervous about what lies ahead, but financial analyst Spencer McGowan, President of McGowan Group Asset Management, tells KTRH the trade war has not really hurt the U.S. economy. "(Trade) is more industry specific to things like agriculture and technology," says McGowan. "But for most business owners here in the United States, the impact is not just limited, it's almost negated by the Chinese devaluing their currency."
The U.S. consumer market also continues to hum along, despite some media reports predicting economic collapse or recession in the face of a booming economy. "Walmart and Target saw a 3.4 percent same store sales increase year-over-year, so they're in fact not in recession," says McGowan.
U.S. markets rebounded Monday on the softer rhetoric from Trump and China, which McGowan sees as another encouraging sign. "The G7 this week is actually a chance at some forward progress that wasn't there until the G7 got together," he says.