Here’s a quick summary according to Goldman Sachs economists Alec Phillips and Andrew Tilton.

  1. To retaliate against the steel and aluminum import tariffs, China can:
  2. Impose their own import restrictions and tariffs on US products/services—i.e. agricultural goods and transport equipment–to China.
  3. Implement unfavorable regulatory actions against US companies in China.
  4. Use exchange rate depreciation to counter the effect of tariffs on their exports.
  5. Sell US Treasuries and other US assets.
  6. Shift their stance on geopolitical issues in a manner unfavorable to the US; particularly North Korea.

Source: CNBC



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