US, China move closer to trade deal despite heated rhetoric

Some analysts are predicting some massive initial market swings. Image Shutterstock

Dollar falls broadly on renewed U.S.

The next deadline is December 15, when a new set of US levies would hit roughly $160 billion in Chinese goods.

People familiar with the talks said Kushner, who helped bring the U.S. -Mexico-Canada trade agreement (USMCA) to fruition, has increased his direct involvement in the negotiations with China over the past two weeks. When asked if he had a deal deadline, he added: "I have no deadline, no ..." "In some ways, I think it is better to wait until after the election if you want to know the truth".

The two sides had been edging towards agreeing a "phase one" trade deal that would see the United States drop its promise to impose tariffs on $156bn worth of Chinese goods on 15 December.

Trump, speaking Wednesday at a meeting in London with German Chancellor Angela Merkel, said the discussions with China are going very well.

Another Chinese government official who declined to be identified said it may take a very long time for Washington and Beijing to reach a deal if they can not find a way to strike a deal while "the iron is hot".

US negotiators expect a phase-one deal with China to be completed before American tariffs are set to rise on December 15, the people said.


Global Times, an influential tabloid published by the official newspaper of China's ruling Communist Party, tweeted on Tuesday that Beijing would soon release a so-called unreliable entities list imposing sanctions against those who harm Chinese interests. Ahead of the opening bell, futures were pointing to a higher open but comments from President Trump in London at a North Atlantic Treaty Organisation conference put the markets on its heels.

On Monday, Trump said he would hit Brazil and Argentina with trade tariffs for "massive devaluation of their currencies".

Kyle Rodda at IG Markets in Melbourne said the concern was that "several complex and muddy issues now being tackled by U.S. and Chinese policymakers at multiple levels of government could all begin to conflate, and start to impact already precarious trade negotiations". "But there's no sign of them doing so in a substantive way", Woodward said.

Trump then threatened duties of up to 100 percent on French goods, from champagne to handbags, because of a digital services tax that Washington says harms United States tech companies.

With a new round of US tariffs on Chinese goods scheduled to take effect in less than two weeks, the possibility of another breakdown is growing. The President said there was no-deadline for the trade deal and a deal would be completed when he was ready.

"I signed these bills out of respect for President Xi, China, and the people of Hong Kong", Trump said in a statement.

On Tuesday, Trump also derided recent comments made by French President Emmanuel Macron - in which Macron described the "brain death" of North Atlantic Treaty Organisation due to lack of American support - as "very very nasty" and "very disrespectful". "I watch jobs. Jobs are what I watch; I watch making the proper deal", he said. "So we'll see what happens".

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