Winners, Losers From U.S.-China Trade War Stretch Coast to Coast
(Bloomberg) -- The U.S. and China are locked in talks aimed at defusing trade tensions between the world’s two-largest economies. Uncertainty about how the negotiations will end up is disrupting hiring and investment plans by American companies.
A few more examples were recounted Wednesday in the release of the Federal Reserve’s Beige Book, a compilation of regional surveys from the central bank’s 12 districts. Here’s a sampling:
“A semiconductor manufacturer facing big declines in demand from China put a hiring freeze in place, but they were reluctant to institute layoffs since it takes three to six months to train new workers.’’
“The semiconductor firm sells mostly to the auto industry and said that a 40 percent drop in new orders from China was the biggest fall in sales since the collapse of Lehman in 2008.’’
“In addition to the ongoing trade negotiations between China and the United States, one manufacturer noted that if Chinese policy makers choose to stimulate heavy industry in their country, the outlook for his organization would be better than it would be absent intervention in the Chinese market.’’
Contacts “thought low soybean prices would lead farmers to switch some fields from soybeans to corn. Contacts noted positive reports on trade talks between the U.S. and China—including news that China bought some U.S. soybeans.’’
“Uncertainty continued to cloud many contacts’ outlooks in the service sector, and trade policy issues with China and Brexit were cited as significant potential headwinds.’’
“One contact in the Mountain West reported that retailers are attentive to ongoing trade negotiations, as certain product supply chains depend on inputs from China and could be negatively impacted if no resolution is reached in the coming months.’’
“A contact in Eastern Washington observed that demand from China for fruit crops declined, and a contact in California noted that walnut exports declined. A raw lumber producer in Oregon reported that sales were significantly lower on a year-over-year basis, due to moderating construction activity and lower demand from China.’’
©2019 Bloomberg L.P.