Gold prices fall as China-US trade war intensifies

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Gold prices are falling after a surge in Chinese trade with the US following the US election.

The Chinese dollar fell more than 1.5 per cent against the US dollar in early trade and futures on Tuesday.

The gold price is also down around 5 per cent from its highest level on August 6.

The fall was driven by the US elections.

The US dollar has lost around 1 per cent since Mr Trump’s election victory.

The move has also led to a fall in Chinese stock prices.

There was a sharp drop in the US stock market on Tuesday, with the Dow Jones Industrial Average down more than 20 per cent.

US President Donald Trump has said he will not take part in the G20 summit in China but has said his country is ready to meet the trade challenge from China.

Mr Trump has been calling for trade restrictions on China.

The latest news from China came on Monday when Mr Trump called the China-based state-run Xinhua news agency to complain about a Chinese newspaper that was publishing photos of Mr Trump in a bikini.

It said the pictures were taken at a golf resort.

US trade officials said the US had been working on a package of reforms with China that would include tariffs on Chinese goods and the use of an international tribunal to crack down on rogue companies.

The package was being prepared for signing by US Trade Representative Robert Lighthizer on Tuesday morning, Mr Trump said on Tuesday night.

“The United States is ready and willing to work with all nations on the issue,” he said.

“We will continue to work to close this unfair trade gap that we have and to do it in a fair and just way.”

The Dow Jones is down over 1,100 points at the time of writing, while the S&P 500 is down about 1,500 points.

The index is down by about 2.5 points over the past month.

Mr Lighthiser is expected to sign a $1.2bn (£1.1bn) package of trade and investment measures on Tuesday that will include tariffs of 10 per cent on Chinese exports and 30 per cent tariffs on US imports.

The measures will be part of a trade agreement known as the Trans-Pacific Partnership, which is due to be signed between the US and 12 Pacific Rim nations this year.

The Trump administration is pushing for more aggressive action on China and has threatened to impose tariffs on imports of certain types of steel and other goods.

The White House said the measures would help China to “counterbalance the growing power of the United States and other countries”.

US stocks have fallen by more than 40 per cent this year as investors have turned away from the US, which has been hit by a series of bad trade deals.

The Dow has plunged more than 700 points since November 6 when it hit a record high.

The S&P 500 has dropped by more 1,400 points and the Nasdaq has lost more than 10 per a share.

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