The U.S. and China have upped the ante in their ongoing trade war, as the Trump administration threatened new tariffs on Chinese imports and Beijing retaliated by letting the yuan depreciate, which prompted the U.S. Treasury to label China a currency manipulator.All this happened in the past six days and has implications for both savers and borrowers in Canada.Story continues belowThe tit-for-tat rattled financial markets, briefly sending stocks plunging and pushing up the price of bonds. On Monday, the S&P 500 — which measures the value of the stocks of the 500 biggest corporations traded on the New York Stock Exchange or Nasdaq Composite — shed three per cent of its value, its biggest loss since the beginning of the year. The Dow Jones Industrial Average and the Nasdaq Composite, the other two major U.S. stock indices, also notched steep losses, landing roughly where they were 12 months ago.While Canada’s benchmark stock market index, the TSX, was closed for the civic holiday, indices in other countries also fell.Meanwhile, nervous traders flocked toward safer financial assets, pushing up bond prices as yields moved lower. A low return, or yield, on longer-term bonds typically signals investor concerns about future economic growth.WATCH: Wall Street recovers after tumble but trade war fears continue to simmer
Stock market rumbles and maybe a recession? What the U.S.-China trade war means for you
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