But there have been signs in the past few weeks that as U.S. President Donald Trump has ratcheted up the pressure on
China over its trade policy — including a series of threats to impose punitive tariffs on Chinese goods coming into the United States — that a backsliding on deleveraging may be close.
On Sept. 5 of this year, the Dow dropped 234 points amid a series of potentially volatile political events, including the debate over raising the debt ceiling, a possible government shutdown, and threats from
Trump over trade policy with China.
Congress has formal
authority over trade policy under the US Constitution, but it has generally delegated much of its authority to the executive branch in modern times.
That would, in turn, give the «America First» trade advisers in the White House a stronger
grip over trade policy and could make other controversial tariff policies more likely in the months to come.
Lighthizer, who is seen as solidifying his
control over trade policy, is considered more aggressive about overhauling NAFTA than is Gary Cohn, head of Trump's National Economic Council.
With Cohn absent in
debates over trade policy, it seems likely that Trump could become even brasher in his proposals to erect trade barriers around the American economy.
«The extent to which the global economy's upturn is threatened by the
uncertainty over trade policy is clearly the main issue preoccupying many investors.