UBS expects China and the United States to have a higher chance of reaching a trade agreement in the second half of the year

China-US trade prospects are unclear. The market expects that China and the United States will negotiate again at the G20 summit at the end of this month. However, UBS expects the two countries will have a higher chance of reaching a trade agreement in the second half of the year.

Hu Yifan, investment director of UBS Wealth Management Asia Pacific, believes that both China and the US are not eager to reach an agreement, so the possibility of reaching an agreement before the G20 summit is only 20%; and the possibility of reaching a trade agreement in the second half of this year is 70%.

She expects that if China-US trade negotiations break down, both stock markets will fall 10% to 15%, and the yuan will fall below 7; if China-US trade negotiations continue, the possibility of a renminbi breaking 7 is small.