The ongoing trade war between U.S. and China is being cited as one of the biggest threats to a global economy that’s already slowing down. As a result, central banks including the U.S. Federal Reserve, the European Central Bank and many across Asia have slashed interest rates to prop up growth. A number of governments, such as China and India, have also cut taxes to stimulate their economies.
In one instance, China’s Commerce Ministry said both sides had agreed to cancel existing tariffs in phases. However U.S. President Donald Trump later said he had not agreed to roll back those tariffs. The President also threatened to raise tariffs on Chinese goods if a deal isn’t done. It is believed that U.S. and China agreed to work towards a ‘phase one’ deal. But Washington and Beijing have since sent mixed signals about whether or not the partial deal would be done.
Uncertainty over a deal between the two countries have caused several businesses to hold back plans on expansion and investment, one of the main reasons attributed to slow rate of growth in several countries.