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Brazil's Bolsonaro asks Trump to be more understanding on tariffs

04 December 2019

In a second Twitter post, Trump signaled that he wants the US central bank to do something about suppressed currencies.

2 renewed steel and aluminum tariffs on Brazil and Argentina, a measure aimed to defend USA producers and workers.

Hours before he was set to depart on Monday for a North Atlantic Treaty Organisation conference in London, Trump tweeted that "Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers".

"Effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the US from those countries". Macri was defeated in elections in October and will leave office next week.

Brazil is grappling with stubborn double-digit unemployment, and its economy is headed toward its third straight year of roughly 1% growth, following two years of deep recession.

Brazil's President Jair Bolsonaro said he would seek talks with Mr Trump.

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In a statement, Brazil's government said it was already in discussions with Washington.

Monica de Bolle, senior fellow at the Peterson Institute for International Economics, believed Trump's tweets were an effort to pressure Brazil and Argentina into helping him with China.

"This is an unfair relationship". Lighthizer said his office "is focused on countering the growing protectionism of European Union member states, which unfairly targets US companies, whether through digital services taxes or other efforts that target leading USA digital services companies". "I don't see this as retaliation", Bolsonaro said in a radio interview with Brazil's Radio Itatiaia.

He then directed U.S. Trade Representative Robert Lighthizer to negotiate with countries seeking to turn their temporary tariff exemptions into permanent ones. A new round of tariffs for Chinese products is set to take effect December 15. The move could drive Brazil to tighter trade ties with China, analysts said. The company denies that claim.

The president went on to say the Federal Reserve should "act likewise", so many other countries stop taking advantage of the US dollar by further devaluing their currencies.

"Our steel companies will be very happy and our farmers will be very happy", Trump told reporters at the White House.

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"Lower Rates & Loosen - Fed!" he admonished the independent agency.

"Their economy is not comparable with ours; it's many times bigger". "It is not clear if this measure would represent a reduction/removal of this quota or another further measure".

And Brazil and Argentina have benefitted from the USA trade war with China, as they have stepped in to replace American exports of soybeans and other agricultural goods to the Asian giant.

He also has earmarked almost $30 billion for farmers to help make up for their losses. The excess capacity in steel and aluminum has been a chronic problem for decades and created a destructive ripple effect on US producers and workers.

Domestic demand has slumped along with the energy sector as drillers pull back on purchases of steel pipe.

"For many Brazilians, this smells like revenge for their country's soybean farmers bonanza - they have benefited enormously from the U.S". It has laid off workers and shut down some of its blast furnaces. These are companies that French officials say should be paying their fair share of taxes in countries where they make money. Shares of AK Steel are down 10%, even as the S&P 500 sets record highs repeatedly.

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Brazil's Bolsonaro asks Trump to be more understanding on tariffs