US Treasury Secretary Scott Bessent has warned countries against aligning with China, cautioning that any attempt by China to devalue its currency in response to US tariff hikes could lead to a global trade war. Bessent emphasized that such a move would prompt other countries to raise their tariffs to offset the devaluation, ultimately harming their own economies.
The US has imposed tariffs on Chinese products, prompting China to retaliate with its own levies on American imports. China has weakened its yuan to the weakest level since 2010, sparking concerns about a potential currency war. Bessent’s warning highlights the complexities of global trade and the potential consequences of currency manipulation.
Several countries are seeking trade negotiations with the US, including Japan, which is set to begin talks soon, and Vietnam, which has a delegation scheduled to visit Washington. South Korea and India are also exploring trade negotiations with the US.
The US aims to reduce its fiscal deficit and promote fair trade practices, while countries surrounding China are seeking to strengthen their trade relationships with the US. Bessent’s warning underscores the challenges of navigating global trade in a complex and interconnected world. The situation remains fluid, with ongoing developments in trade policies and negotiations.
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