Saturday, October 31

Lawmakers pressure USTR Lighthizer to strike a formal trade deal with Taiwan to reduce reliance on China

Early Friday morning in Asia, the South China Morning Post (SCMP) came out with the news suggesting further Sino-American tension. The piece relies on the letter signed by 50 Senators from America that urges US Trade Representative Robert Lighthizer to build a close trade tie with Taipei

There are two causes for the push indirectly signaled in the piece. One is to gradually step back from China and the other is to help Taiwan become independent by highlighting it as a viable partner that is open for business.

Market implications

The US policymakers’ intentions behind the push are suggesting a strong dislike for Beijing and can weigh on the market’s risk-tone sentiment. However, China is enjoying the Golden Week holidays and hence the market reaction to the news is minimal. That said, S&P 500 Futures drop around two points to start the US Nonfarm Payrolls (NFP) day.

Credit: FX Street

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