If Trump labels China a currency manipulator, the confrontation would escalate, said David Roche, global strategist at Independent Strategyy. - From CNBC
President Donald Trump proceeds with plans to label China a currency manipulator, the confrontation would likely escalate beyond trade, David Roche, global strategist at Independent Strategy, told CNBC on Monday.
"Although there are actually no economic grounds, according to the U.S.
Treasury's own criteria, for judging a country to be a currency manipulator, I believe on the grounds of politics, Trump will force this through his Republican support and that'll be the start of a confrontation with China, which I think is actually the point at which the proverbial soft stuff hits the fan," Roche told CNBC's "Squawk Box" on Monday.
In fact, China's policymakers have appeared to be supporting their currency in recent months, not trying to push it lower.
It'll involve things that can happen to American executives and organizations in China, such as nice tax audits." Chinese President Xi Jinping will be aiming to consolidate his power by appointing allies at the congress and possibly even signal he will stay on for an unprecedented third term.