Trump will want trade deal with China before 2020 elections, says DWS senior executive
- DWS, Deutsche Bank’s asset management arm, has taken cash in its fixed income portfolios, according to Sean Taylor, chief investment officer for Asia Pacific
- Asset manager has become more ‘defensive’ in equities to preserve returns
US President Donald Trump will probably want to reach a deal with China in the trade war by next year in order to avoid hurting the American economy before the 2020 elections, according to a senior executive at DWS Group, Deutsche Bank’s asset management arm.
Trump’s threat to put 25 per cent tariffs on US$300 billion of Chinese-made products later this year could hurt the US economy by either forcing consumers to pay higher prices or squeezing corporate margins, said Sean Taylor, chief investment officer for Asia Pacific at DWS.
“The things that the people who didn’t vote for Trump would have been pleased with Trump have been the economy and the asset markets,” said Taylor.
“If more of the tariffs start to impact those two things, that’s not going to be great for him going into the election.”
Morgan Stanley said in a research note last week that the global economy could be in a recession within the next three quarters if the US puts tariffs on nearly all Chinese-made products and Beijing responds with its own countermeasures.
