Aggressive trade actions against China has risen - Nomura

Today, in another sign of cooling relations between the US and China, the Treasury Department announced an additional set of sanctions for Chinese and Russian companies suspected of aiding North Korea in evading economic sanctions, as noted and explained by analysts at Nomura. 

Key Quotes:

"While the sanctions were primarily aimed at reducing the funds available to Pyongyang for its nuclear weapons and missile programs, the implication of China needing to take further action to address tensions on the Korean peninsula was apparent. 

This move follows an announcement by the Office of the US Trade Representative (USTR) last Friday of an official investigation into China’s intellectual property (IP) practices. 

While the investigation was expected, following an executive memorandum from President Trump, the speed at which the official investigation was opened was slightly surprising. 

However, we do not see any material increase in the likelihood of more serious trade conflicts. While the risk of more aggressive trade actions against China has risen, we still expect the IP investigation to take months, if not more than a year, to be resolved."