Analysis of the Impact of the Sino-U.S. Trade War on the Manufacturing Cycle and Inflation

Long-term Impact

• A 145% tariff will suppress demand and accelerate supply chain decoupling.
• Manufacturing costs in the United States are expected to increase by 8%-15%.
• Inventory pressure peaks in 2026, manufacturing cycle downturn.

Market Response

• U.S. stocks: Industrial sector rises in the short term, tech stocks under pressure.
• Cryptocurrency: Fluctuates with changes in inflation and liquidity

Investment Suggestions

• Pay attention to the PMI index and the first quarter financial reports
• Cautious layout of the manufacturing industry
• Consider investing in Southeast Asia supply chain-related stocks

Macroeconomic Environment

The US and China have fallen into a stalemate, with mutual imposition of high tariffs leading to increased economic losses. The positions of approximately 80 countries will play a crucial role in the US-China game, especially regarding the escalation of the trade war and the restructuring of supply chains. The game between the US and China may shift from a "chicken game" to a "hawk-dove game," and the support of global economies will determine the final outcome.

Capital Flow Analysis

• ETF funds: This week saw a significant inflow of 3.014 billion, with an improved performance in the capital market.
• Stablecoin: This week, 2.17 billion was issued, with a moderate issuance level.
• OTC Premium: Stablecoin premium rebounded, slight premium

Major Cryptocurrency Market Analysis

Bitcoin ( BTC ):

• Technical aspect: At a high position on the four-hour chart, be cautious of a pullback after a surge.
• On-chain chips: Chip peak returns to around 93,000

Ethereum ( ETH ):

• The trend is weaker than BTC, ETH/BTC price ratio has broken down.
• The increase in active on-chain addresses may indicate the completion of a phase of bottoming.

The Impact of Tariffs on Manufacturing

Short-term impact ( Q2-Q3 2025 )

• Exports surge: China, Vietnam, and the United States see a 20% increase in imports and exports.
• Inventory backlog: Manufacturers stockpiling to avoid tariffs, significant inventory pressure in Q3
• Impact on various industries:
  • Electronics: PC/mobile Q2 shipment forecast revised up, growth rate in 2025 reduced to 0-3%
  • Textiles: Shoe prices increased by 11.6%, sales decreased by 10-15%
  • Automotive: Q2 sales hit a record high, demand in the second half of the year declines

Long-term impact ( Q4-2026)

• Demand downturn:
  • Electronics: Prices increase by 10-20%, shipments will remain flat in 2025
  • Textiles: China's exports down 80%, shoe prices up 50%, sales down 15%
  • Cars: Electric vehicle prices rise by 10-15%, sales decline
• Supply Chain Restructuring:
  • China: accounts for 30% of global manufacturing, shifting towards the Global South
  • Team USA: Costs have risen by 8-15%, relying on US-Mexico-Canada.
  • Transfer Trends: Textiles to Vietnam/India, Electronics to Taiwan/Japan/South Korea/India, Automobiles to Mexico
• In 2026, the inventory destocking pressure will peak, and the manufacturing cycle will deteriorate.

Key Observation Indicators

• Soft data: PMI and price expectations peaked in Q2-Q3
• Hard data: Q2 exports/industrial production increased by 20%, slowing down after Q3
• Earnings report: Focus on Apple, Nike, and Tesla's Q1 tariff costs and demand guidance
• Policy: Federal Reserve inflation response, tariff exemption policy