US, China move closer to trade deal despite heated rhetoric

Darnell Taylor
December 4, 2019

The S&P 500 and Nasdaq indices fell by 0.6 per cent each.

Investors piled into government bonds, driving the yield on the 10-year US Treasury note to a one-month low near 1.7 percent. Trump on Monday signalled he wants the Federal Reserve to act to weaken the dollar.

Ross's comments came hours after Trump said that he had "no deadline" on the trade deal.

"The Chinese side must have such a requirement, because the Chinese side has promised more USA agricultural purchases. We've had some very good benefits from that", Ross told Reuters in NY.

But Chinese officials have never confirmed an agreement was imminent and have said the talks remain ongoing.

Chinese government sources told Reuters in October the list's publication will depend on the state of the trade negotiations; one of them said at the time that Beijing would hold off on releasing the list until the trade situation with the United States "is at its most tense".

"What President Trump envisions with tariffs is a means to an end, and the end ... is free trade", he said.

On Dec. 2, Trump reinstated tariffs on steel and aluminum from Brazil and Argentina in response to recent currency devaluation in those countries, which were negatively impacting American farmers, he said. Trump's top trade negotiator, Robert E. Lighthizer, said the levies came in response to a French digital services tax that the US determined is discriminating against American Internet companies.

US Commerce Secretary Wilbur Ross on Tuesday said that while staff-level talks are continuing with Chinese officials, no high-level meetings are scheduled.

Root's epic 226 gives England 101-run lead over Black Caps
Another wicket was not forthcoming though as Williamson and Taylor steadied New Zealand and gradually chipped away at the deficit. This is Joe Root's biggest innings in terms of ball play, while this is his second biggest innings in terms of runs.

Global financial markets have gone into a tailspin amid mounting concern that the United States and China are not going to conclude an interim trade agreement before a new set of American tariffs hit Chinese goods on 15 December. "I think any wrong words and deeds must pay the due price". "Because otherwise, there's a tendency of the other side to say 'Oh, he needs it for political reasons, so we'll give him a worse deal than we would.' He's not going to play that game".

But Seema Shah, chief strategist at Principal Global Investors, said Trump could not afford a repeat of the stock market's sharp falls in late 2018, when he raised the temperature of the trade war.

"Any doubts about the vulnerability of equity markets to the mood of the U.S. President should have been dispelled, as his recent tweets and comments have almost wiped out the entirety of November's gains", said Ian Williams, economics & strategy analyst at Peel Hunt.

Xi and Trump were expected to meet in Chile in November for the Asia-Pacific Economic Cooperation (APEC) summit and sign an agreement that would cancel the planned tariff hikes.

"In some ways I think it's better to wait until after the election with China", Trump told reporters in London.

Stocks have jumped higher alongside bond yields as Bloomberg reports that the USA and China are moving closer to a trade deal before the 15 December tariffs deadline. "And China is paying for it, and China is having by far the worst year that they have had in 57 years".

Investors and manufacturers alike have been hoping that the USA and China might resolve this issue, which has slowed economic growth on a global scale.

President Trump's comments Tuesday, which downplayed the possibility of a trade deal being reached in the next couple of weeks, were "off the cuff" and should not be taken as a sign that talks are at an impasse, Bloomberg reports, citing people familiar with the matter.

Other reports by

Discuss This Article