(JPM on trade) Media reports have been warning for weeks of Trump’s intention to turn towards trade issues in 2018 but thus far this hasn’t amounted to much more than aggressive rhetoric (in fact, the White House tone towards NAFTA has improved slightly at the margin of late). The next major trade-linked events to watch will be Trump’s speech at Davos (Thurs 1/25) and the conclusion of the NAFTA negotiations (1/29 in Montreal).
(Bloomberg) — Amidst the euphoria over fresh record highs in U.S. stocks, Societe Generale SA is among a few investment firms now highlighting warning signs for investors. Concerns over a flattening U.S. Treasury yield curve — a sign to some of a coming economic slowdown — have quieted down for the moment, thanks to the recent pick-up in longer-dated yields. But the potential slowdown message has an echo in diminishing corporate cash flows according to SocGen strategists
(PTI) — China today expressed dissatisfaction over a US move to impose steep tariffs on imported solar cells and washing machines, asking America to refrain from “overusing” trade remedies and play a positive role in promoting the world economy.
Mexico Econ Min Guajardo: we can find a NAFTA deal satisfies all three nations
– Mexico will need to look at a response to US tariffs announced yesterday on washing machines and solar
– Won’t negotiate NAFTA through the media
(Bloomberg) Climate change is one of the three key challenges facing human civilization, India’s Prime Minister Narendra Modi said in a speech. While the impact of extreme weather is on the rise, few countries are backing promises to curb carbon emissions with action, he said. The other risks are protectionism and terrorism, said Modi, the first Indian prime minister in two decades to attend Davos. Meanwhile, nationalist policies are on the rise and “globalization is slowly losing its luster,” he said, adding that most areas of India’s economy have been opened to foreign investment.
(Bloomberg) — The three-day government shutdown battle may have hastened an immigration debate in the Senate, but it also deepened the acrimony and highlighted bitter divisions between the two parties that stand in the way of a compromise.