Huawei issue - not about trade at all.

Author: Eamonn Sheridan | Category: News

This via a Deutsche Bank note on China, US, Huawei, yuan ...

It opens with a question. A gnarly one.
  • Let's pose a simple question: In the coming decade will China's military operate on US software, and will the US's military operate on 'made in China' hardware? If the answer is no, then you can quickly understand why the Huawei issue is the leading edge of a much-bigger issue of technology disentanglement and disengagement of supply chains that goes well beyond traditional views on issues of fair trade.
The note goes on, but I like the question ...over to forexlive for comments.

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I guess should add what DB say on USD/CNY yuan (this in summary ):
  • If the answer on Huawei issue is that the US administration has simply used this as a bargaining chip, then 7 will hold.
  •  If this is instead part of a broader strategic disentanglement, this will have much-wider implications for global supply chains and will become a story of an onward and upward for USD/CNY
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