In other news, the White House Office of Management and Budget (OMB) will formally publish rules to ban government agencies from buying equipment or services from Chinese-owned telecommunication giant Huawei tomorrow. China is expected to retaliate in some manner.
Meanwhile, the Association of China Rare Earth Industry, a trade group for China's rare earth business, has formally declared its support for possibly cutting off exports of rare earth minerals to the U.S. in retaliation for Trump's tariffs. This would be very bad news for consumer electronics makers.
Finally, Goldman Sachs is telling investors and clients that they expect the Federal Reserve will cut interest rates again in October because of a combination of Trump's trade war, the Brexit, and a global economic downturn.
"In light of growing trade policy risks, market expectations for much deeper rate cuts, and an increase in global risk related to the possibility of a no-deal Brexit, we now expect a third 25-basis-point rate cut in October, for a total of 75 basis point of cuts," economists led by Jan Hatzius wrote in a note.
Goldman sees a 75% chance of a 25-basis-point cut in September, a 15% chance of a 50-basis-point cut and a 10% chance of no cut.
For the October meeting, the bank sees see a 50% chance of a 25-basis-point cut, a 10% chance of a 50-basis-point cut and a 40% chance of no cut.
"By the December meeting, we think inflation numbers running at roughly 2% will lead the Fed to stop cutting," Goldman’s economists wrote.
Trump will get his rate cut if he has to destroy the global economy to do it.