Rising US-China tensions weigh on markets as Covid-19 economic costs mount – business live

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Rolling coverage of the latest economic and financial news

8.37am BST

A dire slump in exports helped to drive South Korea into its worst slump in over 20 years

Asia’s fourth-largest economy contracted 2.9% year-on-year in the April-June period, the Bank of Korea said, after a fall of 1.3% in the first quarter, putting the country into recession for the first time in around two decades. It’s the fastest decline since the aftermath of the 1998 Asian financial crisis, when it fell 3.8%.

South Korea was one of the worst hit countries outside China in the early part of the pandemic, recording around 900 new cases a day in February. But by April, an intensive tracking and tracing campaign had reduced the daily figures to single digits. The country is now battling new outbreaks, including one centred on bars in Seoul.

Related: Global report: South Korea goes into recession as Australia flags huge deficit

8.25am BST

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

Investors have plenty to worry about today.

CHINA’S YUAN OPENS TRADE AT 7.0088 PER DOLLAR VS LAST CLOSE AT 6.9989

“I guess they were burning documents and burning papers.”

*CHINA’S BLUE-CHIP CSI300 INDEX DOWN MORE THAN 1% IN MORNING TRADE pic.twitter.com/9rWAJ61lNP

“US-China tensions could persist into the US election in November. A change of leadership might not mark the end of pressure on China from the US.

Investors around the world need to consider the implications of trade policy and other major election policy issues for their portfolios.”

South Korea enters first technical recession since 2003. pic.twitter.com/gvEDycvnbi

Related: Coronavirus live news: California sees record daily cases as global infections top 15m

The number I’ve heard more frequently (including today) is that GOP will propose $200/week; Pelosi proposes $600/week; & they end up somewhere around $400/week.

But this report suggests GOP will come in lower, at ~$100/week, which is lower than what Trump said yesterday https://t.co/3cCGRwbhQ5

The still high caseload across the US means that the need for additional stimulus is still fairly acute, however optimism surrounding a bill being enacted in the next 2-3 weeks is fading.

Congressional Democrats and Republicans remain nearly $2tr apart in funding. Senate Minority Leader Schumer said late yesterday that it would not make sense for Democrats to start talking to their Senate counterparts until Republican leadership had a bill to work off.

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