Worries that the United States and China were digging in for a longer, costlier trade war weighed on financial markets on Monday as Beijing accused Washington of harboring “extravagant expectations” for a deal to end their dispute.

Driven by anxiety over the success of China’s growth model, the US under Trump has sought to apply “maximum pressure” through its trade war. However, an eventual bargain will serve to cement China’s leadership role not only in economics, but also global governance.

The smaller deficit suggests U.S. economic growth in the first quarter might have been stronger than previously estimated.

Disappointing indicators show similar picture in US, China and Europe

Indexes of factory activity suggest an uneven global growth outlook.

The world has to prepare itself for a new monetary cycle following rising US interest rates.

The US has fallen into the hands of a wealthy predator class that controls the government.

If effective policy measures can't be taken to contain it, the risks to the world economy caused by the escalation of protectionism could severely disturb the world in 2018.

It is clear from this year’s Davos conference that while America has shifted its attention from maintaining the world order to strengthening its domestic economics, China is making use of the “leadership vacuum” and trying to convince the world that it is qualified.

China should be willing to loosen trade and investment restrictions if it seeks to play a leading role in globalization, International Monetary Fund First Deputy Managing Director David Lipton said.