The trade war between the world’s two largest economies, the United States and China, entered its second year in 2019, progressively weighing on both countries’ economies amid falling business sentimentality internationally. Here below are six comparison charts that look at how the top two economic giants of the world and their financial markets performed in the year.

Economic growth in the United States and China

Growth in the overall local product – the most extensive measure of an economy – slowed down in both China and the United States last year.

Statistics show the percentage change in real GDP on a year-on-year basis

Many economists estimated that growth rates in two states could moderate even more in 2020 because of their continuous domestic challenges and trade friction. That might put some pressure to an already fragile worldwide economy.

Declines in Trade Volumes

In both countries, overall exports and imports fell in the first ten months of 2019, compared to the previous year. That came due to the slower trading activity globally – a trend some analysts said started even before the trade war between the U.S. and China.

U.S.-China trade with World

The overall trade deficit of the U.S., majorly contributed by a two-sided imbalance with China, has not changed much in 2019. That’s because of the trade imbalance between the United States-China falling from $344.5 billion in the 2018 January-to-October period to $294.5 billion a year later, according to the statistics by the United States Census Bureau.

Manufacturing Downturn

The manufacturing sectors of the United States and China felt the effect of a slowing international economy that made worse due to the trade war between the two giant economies.

Manufacturing sector PMI

Official manufacturing Purchasing Managers Index of China – a broadly watched indicator of the health of the sector – stayed in reduction territory for a maximum time of the year. It means the index came in less than the 50-point level. In the United States, the manufacturing PMI gathered by the Institute for Supply Management (ISM) revealed factory activity contracting since August.

Retail Sales Stable

Consumer spending in the United States and China were among the optimistic spots of their respective economies in 2019, maintained by a stable labour market in both countries.

Growth in Retail Sales

Figures show percentage change on a year-on-year basis

But some risks still remain that the optimism may not sustain. Some of the senior analysts warned that additional tariffs of the United States on Chinese goods might reduce spending among U.S. consumers. Singapore’s UOB Private Bank’s investment strategist, Francis Tan, said that the rising pork prices in China might cut spending of consumers in other areas.

Currency Movements

A comparatively strong United States economy and preference of investors for safe-haven assets bigger demand for the greenback, lifting the value of the currency for 2019.

U.S. dollar index measures the greenback against six leading currencies; CFETS RMB index compares the Chinese yuan with 24 currencies

In contrast, the authorities of China allowed its yuan to depreciate for most of the time in 2019. That move attracted allegations of currency manipulation from the President of the United States, Donald Trump. But the IMF said that the yuan’s value was in line with the economic fundamentals of China.

Stock Market Rally

In financial markets, the Federal Reserve rate cuts and declining trade dispute tensions during some specific periods in the year supported the sentiment of the investor. They sent stocks on Wall Street to several new highs this year instead of the weak corporate earnings.

Stock Market Performance

Over in China, the presence of the stocks of China into the leading global benchmarks helped the Shanghai Stock Exchange (SSE) Composite Index to record a double-digit climb in 2019.

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