(WASHINGTON) Harley Davidson will move some production out of the US to avoid EU retaliatory tariffs: It was a sign of an early administration strategy as companies wrestle with Trump’s trade fights, which he says will benefit American workers but first there will be upheaval and pain before the real gain #AceFinanceDesk reports

#AceFinanceReport: June.26: Editor says here’s what we know of their decision and reasons for proposed partial move: President Donald Trump on Monday had sought to frame Harley-Davidson’s decision to move production of some motorcycles overseas as the result of European tariffs and as it was revealed later by Harley-Davidson will move some production out of US after retaliatory tariffs which they say will be devastating to their business #AceFinanceDesk reports

Surprised that Harley-Davidson, of all companies, would be the first to wave the White Flag. I fought hard for them and ultimately they will not pay tariffs selling into the E.U., which has hurt us badly on trade, down $151 Billion. Taxes just a Harley excuse – be patient! #MAGA

— Donald J. Trump (@realDonaldTrump) 10:28 PM – Jun 25, 2018

“Surprised that Harley-Davidson, of all companies, would be the first to wave the White Flag,” Trump wrote on Twitter as he flew aboard his Marine One helicopter from the White House to Joint Base Andrews.

“I fought hard for them and ultimately they will not pay tariffs selling into the E.U., which has hurt us badly on trade, down $151 Billion. Taxes just a Harley excuse – be patient!” he wrote.

Trump continued to train his focus on the company Tuesday, tweeting: “A Harley-Davidson should never be built in another country-never! Their employees and customers are already very angry at them. If they move, watch, it will be the beginning of the end – they surrendered, they quit! The Aura will be gone and they will be taxed like never before!”

A Harley-Davidson should never be built in another country-never! Their employees and customers are already very angry at them. If they move, watch, it will be the beginning of the end – they surrendered, they quit! The Aura will be gone and they will be taxed like never before!

— Donald J. Trump (@realDonaldTrump) 1:17 PM – Jun 26, 2018

The Wisconsin-based motorcycle firm announced on Monday it would shift production of motorcycles intended for European consumers out of the United States, hoping to avoid European Union retaliatory tariffs. Those were applied last week in response to Trump’s own tariffs on steel and aluminum.

For motorcycles, the European bloc raised its 6% tariff to 31%. That will make each bike about $2,200 more expensive to export, Harley-Davidson said.

In a regulatory filing, Harley wrote that shifting production was “not the company’s preference, but represents the only sustainable option.”

Trump has made a manufacturing revival central to his economic message, hoping to retain his political base of white blue-collar workers. He’s said the tariffs he’s applying will realign trade imbalances that harm US workers.

But companies have warned that retaliatory tariffs could be devastating for business, or lead to higher prices for US consumers.

Trump’s tweet on Monday is a sign the administration will continue placing blame on US trading partners, even as American companies shift production or lay off workers amid escalating trade battles.

President Trump says he’s surprised that Harley-Davidson “would be the first to wave the White Flag” after the motorcycle company said it will move some production overseas as a result of tariffs https://cnn.it/2tuT7w5 pic.twitter.com/281tmUtgQW

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MARKETS: China: The benchmark Shanghai Composite slid into bear market territory on Tuesday, closing more than 20% below its recent high in January. The index fell 0.5% on the day following last plunge of 4% as Donald Trumps tariffs slow their economic growth and hitting their sovereign currency the Yuan #AceFinanceDesk reports

#AceFinanceReport – June.26: Chinese stocks have come under pressure in recent weeks from concerns over an economic slowdown and an emerging trade war with the United States: The trade fears have intensified this week following reports the US government is set to announce restrictions on Chinese investment in American companies, potentially escalating the confrontation between the two giant economies, analysts said…………………”It’s a combo effect of concerns about the trade war and China’s GDP growth,” said Dickie Wong, head of research at Hong Kong-based broker Kingston Securities: Last week, Chinese stocks plunged nearly 4% in a single trading day after President Donald Trump threatened to hit China with further waves of tariffs on its exports……………….The Shanghai Composite is one of the world’s worst performing stock indexes this year, and Wong predicts it has further to fall………..The Chinese economy performed strongly last year, growing 6.9%, according to government figures. That momentum continued into the start of this year, but many economists were skeptical it would hold. Signs of a slowdown are starting to appear #AceFinanceDesk reports

shanghai composite 2018 chart

Official economic data for May showed that growth in important areas like exports, investments by companies and consumer spending all declined compared with the same month a year ago.

Shanghai stocks previously suffered extended declines in 2015 and early 2016, which were also triggered by anxieties over the health of the Chinese economy.

China’s currency, the yuan, has also been suffering in recent weeks.

After spending most of last year strengthening against the dollar, the yuan has fallen almost 2.4% since June 14 as fears of a trade war have risen.

A weaker yuan is worsening the rout in stocks, according to Tai Hui, chief market strategist at JPMorgan Asset Management in Asia. It’s “raising concerns that companies who have been heavy dollar debt issuers could face challenges” paying back their loans, he said.

The dollar had already been gaining ground against the yuan and other currencies as the US Federal Reserve raised interest rates.

As China is unleashing more than $100 billion into its economy but the People’s Bank of China, meanwhile, isn’t on the same track. It announced this week that it’s cutting the amount of deposits most commercial banks are required to store with it, which could free up more cash for lending and promote new economic activity.

Analysts at investment bank Nomura say they expect headwinds — including the trade clash with the United States — to further weigh on the Chinese economy in the second half of the year.

“We believe the Chinese economy has yet to bottom out, and the situation could worsen before getting better,” they wrote in a research note late Sunday.

CNNMoney (Hong Kong) First published June 26, 2018: 3:17 AM ET: https://cnnmon.ie/2K6s7gZ pic.twitter.com/HKGaq1oKCmChina’s economy shows signs of slowing. A trade war won’t help

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