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The borders are steep between the United States and the EU after a summer of hard rhetoric about the ongoing trade war. After the United States imposed a steel and aluminum penalty on the EU, the EU reacted to customs on US exports such as whiskey and jeans [19659002] Two months later, the focus is on the automotive market. Customs on all cars imported from Europe.
The EU is now eager to carry out fire-fighting operations. On Wednesday evening, the Norwegian hour meets Jean-Claude Juncker, President of the European Commission Donald Trump in Washington. Jucker said in advance that he was not "too optimistic."
Seeing Two Opportunities
Juncker and Trump are both described as people who consider themselves good retailers, who rarely remain entirely in the script as their closest advisers work for themselves, writes the BBC. Juncker also gave an unusual feature at the G7 meeting early in the summer, the latter saying that he was called "a brutal murderer."
– I think it was supposed to be a compliment, but I'm not quite sure. Reuters in June
Although Wednesday's meeting is not considered a typical bargaining meeting, senior diplomats tell the Politico news website that Juncker will present two proposals to reduce the tense relationship between the United States and the EU.
One is to deduct tariffs on cars and auto parts "against zero" between the United States, the EU, Japan, South Korea and other dealers important automobiles.
The other is to create a form of free trade agreement and the EU on industrial products. Such a solution will create opportunities to remove fees on some of the products from one and the other, without being forced to enter into the same agreement with others.
Trump accuses the EU of currency manipulation
The US president said the country had trade deficit of $ 151 billion compared to the EU last year, c & # 39; that is, the EU has exported more to the United States than it has imported. The New York Times later corrected the figure to just over $ 100 billion.
Trump would face greater difficulties in reducing this trade deficit than initially assumed because he is fighting for currency gains
so good that the price of US goods at the # 39, stranger increases. It could hurt the trade deficit.
– The United States should not be punished for doing so well, writes Trump on Twitter Friday.
The president protested against China and the EU and accused them of manipulating currencies downward, while the US dollar is strengthening for each day, thus reducing US competitiveness.
Trump argues that the dollar is reducing the competitiveness of the United States, but a number of economies point out that it is partly his own mistake.
Punishment of the strong American economy
Halvor Mehlum is professor at the University of Oslo and teaches daily in socioeconomics. He explains that the main reason for the strength of the dollar is that the US central bank sets the interest rates.
The dollar has strengthened considerably over the last three years, affecting the US trade balance.
– The strength of the dollar has two negative effects. Exports abroad are decreasing as US products become more expensive abroad. In addition, imports are increasing because foreign products are cheaper in the United States, says Mehlum.
Mehlum believes that the main reason for the dollar is strengthened is that the central bank of the United States raises interest rates faster than other central banks. Trump was very unhappy with what he showed last week when, in an interview with CNN, he said he hoped the US central bank would stop setting interest rates.
Following the interview, several economists pointed out that Trump himself had a share of responsibility in strengthening the dollar as he reduced his tax rate in the United States, which attracts more of investors in the United States. (Conditions)
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