Rising Trade Tensions
Rising tensions between global trading partners, including US and China tariffs, set the stage for broader challenges to the global trade regime, financial markets uncertainty, disruptions to manufacturing supply chains, and dampened economic growth.
  • SUMMARY
  • REPORTS

  • SECOR COMMENT
    03 Sep 2019|Moody's Investors Service
    We expect the steadily worsening trade friction between the world's two largest economies to leave a lasting impact on the global economy. Of the three plausible scenarios for US-China trade tensions that we have identified, we believe that the risk of a “hardened stance” scenario has increased as trade relations worsen.

    SECTOR COMMENT
    28 Aug 2019|Moody's Investors Service
    The new trade restrictions, which mark a further escalation of tensions between the world's two largest economies, will be credit negative for a number of US industries.
    SECTOR IN-DEPTH
    26 Aug 2019|Moody's Investors Service
    China's restrictions are credit negative for large soybean-producing states, as well as for food processors and providers of loans and other financial services to the farm sector.

    OUTLOOK
    22 Aug 2019|Moody's Investors Service
    We expect global growth to slow below trend to 2.7% in 2019 and 2020, about half a percentage point below the level in 2017-18. Our below-consensus growth forecasts had already incorporated the expectation of deteriorating global growth and some escalation of trade tensions.

    SECTOR COMMENT
    19 Aug 2019|Moody's Investors Service
    The US administration postponed some of its planned new tariffs on Chinese imports, but they remain credit negative for US companies within the affected industries.

    ISSUER COMMENT
    09 Aug 2019|Moody's Investors Service
    On 5 August 2019, the US designated China a currency manipulator. The move is likely to lead to a hardening in the trade dispute between the countries, and slower expansion in both economies, a credit negative for the sovereigns.
    Impact of tariffs on non-financial corporates
    SECTOR COMMENT
    02 Aug 2019|Moody's Investors Service
    The announcement of a new round of US tariffs on Chinese imports planned for September confirms our view that the two countries remain far apart in their expectations and objectives, and that a significant trade deal is not likely this year. The risk of a further escalation of the trade dispute and more tariffs and investment restrictions also remains high.
    SECTOR COMMENT
    02 Aug 2019|Moody's Investors Service
    We believe that many potentially affected retailers, especially the larger names, have taken steps in recent years to diversify their supply chains, thus reducing reliance on China
    SECTOR COMMENT
    02 Aug 2019|Moody's Investors Service
    This latest round of tariffs ensures that all US goods imported from China will be hit with incremental tariffs.

    SECTOR COMMENT
    05 Aug 2019|Moody's Investors Service
    New tariffs on imports from China will be credit negative for toy companies Hasbro Inc. and Mattel Inc. With many key retailers managing with just in time inventory and only expanding shelf space for toys in November to accommodate holiday sales, a significant share of the manufacturers' annual toy sales will be exposed to the new tariffs.