The US-China trade war is at no pace to peace out the respective economies. After the YUAN fall, the US has declared China’s currency as a “currency manipulator”, which will authorize the US government to impose severe policies on Chinese international trade.
It has been a drastic situation for the monetary market in the past 11 years. Its further increase, suggests that if Trump’s harsh sanctions and demeaning allegations will continue to China, economists afraid that neither IMF or WTO will be able to support the US, making it unguarded for international trade concessions.
This trade war has also induced market turmoil at the global level. Major countries trading with China will be affected adversely with weaker Yuan. Even many economies and their politicians have started finding out the safest paths to tackle the situation rather than just weakening their currency.
Countries with free-floating currencies have the advantage to use interest cut rates, which will moderate the demand of their respective currency and at some level will give a similar effect. This technique has already been implied by New Zealand, India, and Thailand.
Apart from economies, the bankers are the ones who are facing major tensions that in return is imposing stress on investors. These tensions and it’s terrible effects are somewhat forming the scenario of the 1930s which resulted in the Great Depression and also influenced the 2nd World War.
Impact on Bitcoin
Though the impact of the trade war is harshly affecting the global economy, it has also widened the perspectives of investors. The popular alternative belongs to the digital world and the traditional means. The Cryptocurrencies like “Bitcoin” and precious metal like “Gold”, are majorly utilized. The Bitcoin is favorable as it is decentralized and way ahead from the government control.
The characteristics of bitcoin are the same as that of Gold, both are transferable, interchangeable, difficult mining. In the present scenario, Bitcoin is expected to have a superior stock-flow ratio than that of Gold.
The rise of it since Monday has given more hope to investors, though experts say its movement is not stable and could not be linked with real-world changes. As of now, investors may choose Bitcoin as an option to further their investments as it will in some probability secure wealth.