Jan 20, 2020

Macron and Trump call ceasefire on digital taxes and wine tariffs

Macron and Trump on Dec. 3, 2019. Photo: Ludovic Marin/POOL/AFP via Getty Images

French President Emmanuel Macron on Tuesday tweeted that he and President Trump held a “great discussion” on a tax on digital services considered by Paris and pledged to work on "a good agreement" with Washington "to avoid tariff escalation."

Why it matters: Macron and Trump agreed to avoid increasing tariffs and continue negotiations on the digital tax during until the end of the year, CNBC reports.

Context: France in July enacted a tax on companies that profited from digital services in the country.

  • The White House in December issued a report concluding that France's tax discriminated against U.S. digital companies and announced that it was considering tariffs as high as 100% on up to $2.4 billion worth of French products, including sparkling wines, cheeses and handbags.
  • The announcement came hours before Trump was headed to the World Economic Forum at Davos, Switzerland, and days after Trump signed a reprieve in the 18-month trade war with China.

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Americans pay the full cost for Trump's aluminum tariffs

Photo: Jim Watson/AFP/Getty Images

President Trump's tariffs have notably increased the price of aluminum for U.S. businesses and consumers, a study provided first to Axios shows.

Why it matters: Trump has insisted the cost of the tariffs would be borne by China and other exporters, but the data shows that Americans are paying the costs.

Go deeperArrowJan 28, 2020

China to cut tariffs on $75 billion of U.S. goods

Chinese Vice Premier Liu He and President Trump at the White House on Jan. 15. Photo: Mark Wilson/Getty Images

China will halve tariffs on about $75 billion of imports from the U.S., effective Feb. 14, the country's finance ministry said in statements posted to its website Thursday.

Why it matters: This is another sign of tensions easing in the prolonged trade war between the U.S. and China that's brought major uncertainty to the markets and hurt the U.S. manufacturing industry and farmers.

U.S. GDP growth slows to 2.3% in 2019

Data: Bureau of Economic Analysis; Note: Shows GDP average over the full year vs. prior year; Chart: Andrew Witherspoon/Axios

U.S. gross domestic product grew at a 2.1% annual rate in the final quarter of last year, the Commerce Department said on Thursday. For all of 2019, economic growth came in at 2.3% — less than the 2.9% in 2018.

Why it matters: The initial estimates from the government show that 2019 was the slowest pace of economic growth since Trump took office. The boost from the tax cuts gave way to pain from the trade war. Exports slumped last year, while uncertain business leaders held off on spending.

Go deeperArrowUpdated Jan 31, 2020 - Economy & Business