SINGAPORE (Feb 25): At times, there seems to be little logic in the trade war strategy employed by the US against China. This apparent lack of consistent strategy makes it difficult to implement sound investment decisions.

The most recent demand that China stabilise its currency is an example of these contradictions because it runs counter to the demand that China make its currency responsive to open international trading in the same way as other major currencies. If China is to stabilise its currency, presumably by market intervention, then it leaves itself open to the charge that it is a currency manipulator. On the other hand, if it allows its currency to react fully to market forces, then it is most likely we would see further weakening in the currency.

US farmers are among the most protected agricultural producers in the world. This creates a contradiction when US trade negotiators complain about China support for some Chinese market sectors.

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook