Trump delays tariff hike suggesting progress on US-China trade talks
Yesterday, an extended week of talks between the US and China on trade issues ended, that were commented by US President Trump as “productive” and also on the Chinese side, the press reported substantial progress.
- On Sunday, US President Trump announced that he would delay to an unspecified date the tariff increase on imports from China which were scheduled to start on March 1.
- Trump acknowledged “productive” trade talks and also the Chinese press reported substantial progress. Trump and Xi are reportedly planning to meet for a summit later in March at Trump’s Mar-a-Lago resort.
- Details about the progress were not given. News from last week point to steps forward to narrow the bilateral trade deficit as well as on ensuring intellectual property rights and tackling alleged forced technology transfer.
- The postponement of the deadline increases the chances of a deal and reduces the risk of a further escalation of the trade conflict, an important source of current global uncertainty. However, given the complexity of the matter, a positive negotiation result is not a done deal yet and existing tariffs could well be maintained for some time.
- The Chinese stock market rallied on the news and the Chinese currency appreciated versus the US-dollar.