The Donald Trump-alleged trade war with China and other nations was a factual failure.
According to the Commerce Department, the U.S. trade deficit surged to a record high in February, ballooning another 4.8 percent to a record $711 billion as the cheap money fiscal stimulus spiked the fastest economic growth in some 40 years.
Meanwhile, U.S. exports declined for the first time since May 2020, edging down 2.6 percent from January to a seasonally adjusted value of $187.3 billion.
As reported by Reuters, Economists at JPMorgan say the trade deficit could subtract a full percentage point from U.S. GDP growth in the first quarter, which would be the third straight quarterly decline.
TREND FORECAST: While U.S. exports slumped, China reported today that its exports for March jumped 30.6 percent from a year ago, while its imports rose 38.1 percent during the same period. This reaffirms China’s “dual circulation” strategy of depending less on exports, importing more, and doing more internal trade among its 1.4 billion people.
While the Chinese yuan has slipped from its recent highs, considering its “dual circulation policy,” we forecast Beijing will keep the currency from falling since the higher its value, the less it will cost to purchase imported products.
