The importance of the newly concluded US-Mexico-Canada Agreement, or USMCA, may have less to do with the details than the signal it sends: President Donald Trump is methodically settling his multifront trade war to fight China.
The United States and Canada reached a deal late on Sunday to salvage the three-country, US$1.2 trillion (S$1.65 trillion) open trade zone agreement with Mexico that was on the verge of collapse after more than two decades.
Economists from JPMorgan Chase & Co believe that the USMCA shows Mr Trump is holding back from launching a "war on trade" that could upend the world economy.
However, he is embarking on a trade war with China that will take a bite out of both countries' economies next year and raise the risk of a broad pullback in global business confidence.
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Trump clears decks for China trade war with new Nafta deal
