The Trump-Xi meeting and the limits of a reset | Germany’s overdone pessimism

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Donald Trump travels to Beijing next week for a long-awaited summit with Xi Jinping that carries huge geopolitical significance, but one where investors should keep expectations firmly in check. Group Chief Economist Neil Shearing and Head of China Economics Julian Evans-Pritchard join David Wilder to assess the state of the US-China relationship and why any apparent thaw in tensions may prove superficial. They discuss issues including: Why Beijing increasingly sees the US as a power in relative decline, and how that is shaping Chinese strategy; Why the structural forces pushing the US and China apart are likely to outlast any short-term diplomatic reset; What’s driving the recent improvement in China’s economy, and how that could exacerbate global tensions. Also on the show, Chief Europe Economist Andrew Kenningham returns from client meetings in Germany to explain why those who had been expecting an economic turnaround last year have been left disappointed, but to also argue that the prevailing gloom around both the German economy and its politics has become excessive.Related content:Read: What would a new PM mean for the UK economy and markets?https://www.capitaleconomics.com/publications/uk-economics-update/what-would-new-pm-mean-uk-economy-and-marketsRegister: Drop-In: Is the energy shock supercharging the Chinese export boom?https://www.capitaleconomics.com/events/drop-energy-shock-supercharging-chinese-export-boomRead: Taking stock of the German fiscal stimulushttps://www.capitaleconomics.com/publications/europe-economics-update/taking-stock-german-fiscal-stimulusRead: Fiscal stimulus won’t fix Germany’s economyhttps://www.capitaleconomics.com/publications/europe-economics-focus/fiscal-stimulus-wont-fix-germanys-economy