India Joins the Trade War
After being taken away some special trade benefits, India retaliates the U.S. by imposing higher tariffs on some goods imported. This decision will take effect on Sunday, June 16. U.S. and India’s ties had broadened significantly in the past decade, having seen trade tensions arise when the Trump Administration imposed tariffs on some steel and aluminum products last year. These tariffs accounted for more than 11%, or $6.3 billion, of India’s total exports of goods.
It’s been a year since New Delhi and Washington had any significant tensions. Officials in India say the tariffs are not a retaliatory movement, since they have waited for a year and now are going forward with the decision.
Middle East Concerns the Markets
Rising geopolitical tensions have weighed on stocks this Friday. The U.S. said Iran was behind an attack on two oil tankers in the Gulf of Oman that increased oil prices significantly. The attack boosted fears of a potential military conflict in the Persian Gulf that could disrupt oil mobility.
Hong Kong’s Extradition Law
The Chinese government is seeking to allow extraditions to mainland China, following that this will help Hong Kong remain a safe city for residents and business.
The new passage proposed would undermine Hong Kong’s status of being a haven for multinational company operations and a global financial capital. The U.S. expressed “grave concern” about the Hong Kong government’s proposed amendments which may damage Honk Kong’s business environment.
Hong Kong saw continuous violence this week, with some government offices and banks closing due to the disruption. Many analysts look back on the 2014 Occupy Hong Kong protests, where the economic impact was limited. While Hong Kong’s internal economy might not be significantly affected, other places in Asia like Singapore may benefit if the proposed changes go through, undermining Hong Kong and its stock market––Hang Seng––as a global financial hub.