The recent agreement between the USA and China in the long-standing tariff dispute has led to a significant reduction of the respective tariffs. This development offers positive outlooks for the global financial markets, especially for the DAX in Frankfurt.
Details of the Tariff Reductions
Specifically, the USA has reduced tariffs on Chinese imports from up to 145 percent to 30 percent. In return, China has lowered its tariffs on goods from the USA from 125 percent to 10 percent. These changes are initially valid for a period of 90 days as a kind of “ceasefire,” while new negotiations are being sought.
Impact on Financial Markets
For private investors and small investors, the consequences of this agreement are particularly relevant. The reduction of tariff rates decreases uncertainties in international trade and can strengthen confidence in the markets. Such positive signals often lead to price increases in major indices such as the DAX, which is now trending towards the 24,000 points mark.
Summary of the Benefits
- The tariff reductions of about 115 percentage points mark a significant step towards easing the trade conflict.
- The temporary adjustment is initially valid for 90 days.
- Financial markets have reacted positively, which is reflected in the rise of the DAX.
- For private investors, potentially better conditions arise due to decreased trade risks and increased stability.
This development exemplifies how strongly international political decisions can have immediate impacts on national stock indices and thus also on private portfolios.