Financial markets are waiting to see what happens with the trade tensions between Washington and Beijing. If they escalate into an all out trade war, then, analysts predict the global economy may go off a cliff as soon as the end of this year.
The relations between China and the US are rather strained at the moment. After Washington imposed high import tariffs on Chinese imports, China retaliated in kind. At the same time, according to the White Book published June 2, China has no interest in a trade war with the US.
Meanwhile, on its other economic front the US is combating illegal immigrants from Mexico. As part of this effort, Washington announced a new 5% tariff on Mexican imports. If the flow of illegal migrants does not stop Trump intends to gradually increase the import tariff on Mexican goods and services to 25%.
India is next in line seeing how the US imports more than 2,000 types of goods tariff free from that country. However, everything will change should the US stop regarding it as a developing economy.
There also exist some trade tensions between the US and the EU.
On the morning of June 3 one Euro was trading at USD 1.12.