Both the motivation and the likely consequences suggest that Monday’s announcement is yet another notable step in an escalation of tensions between China and the U.S. that could well get worse before it gets better. They suggest that, for those looking for calmer times in international trade relations, the best that could be realistically hoped for is a series of ceasefires. The more likely outcome for the coming months, if not longer, is intensifying trade tensions coupled with intensifying currency tensions.
Mohamed A. El-Erian is a Bloomberg Opinion columnist. He is the chief economic adviser at Allianz SE, the parent company of Pimco, where he served as CEO and co-CIO. He is president-elect of Queens' College, Cambridge, senior adviser at Gramercy and professor of practice at Wharton. His books include "The Only Game in Town" and "When Markets Collide."