Caixin
Dec 13, 2019 04:29 AM
ECONOMY

Trump Says Deal With China Is Getting ‘Very Close’

Photo: VCG
Photo: VCG

U.S. President Donald Trump said Thursday the U.S. is moving “very close” to a trade deal with China, stoking investors’ optimism about a possible truce between the world’s two largest economies right before new duties take effect.

“Getting VERY close to a BIG DEAL with China. They want it, and so do we!” Trump wrote in a tweet.

The S&P 500 Index rallied to an all-time high shortly after Trump’s tweet. The MSCI All-Country stock index rose to its first record since January 2018. The 10-year Treasury yield spiked higher and the dollar edged up.

The U.S. is scheduled to impose a new round of 15% tariffs Dec. 15 on about $160 billion of consumer goods imported annually from China. Many have expected a delay of the planned levies to give the two countries more time to negotiate an interim deal.

In the 17-month trade war, the U.S. has imposed 25% duties on about $250 billion a year of Chinese imports and 15% on an additional $110 billion of goods. China has retaliated with similar measures.

China and the U.S. have been locked in negotiations on a phase one deal since October, which could involve China’s purchase of more U.S. agricultural goods and some tariff relief.

China’s Finance Ministry said last week it’s in the process of waiving retaliatory tariffs on imports of U.S. pork and soy by domestic companies, a move widely seen as a signal for a coming deal.

Gao Feng, spokesman for China’s Ministry of Commerce, said at a regular briefing in Beijing Thursday that trade teams from China and the U.S. remain in close touch, without providing further details.

Tariffs set to take effect Sunday would affect a range of consumer goods such as toys, phones and clothing. Trump’s Agriculture Secretary Sonny Perdue said earlier this week that the tariffs are unlikely to be implemented.

“I think we may see some backing away,” Perdue said.

A closed-door meeting at the White House is expected Thursday to discuss how Trump will proceed before the new tariffs take effect Sunday, Bloomberg reported.

Additional reporting by Bloomberg

Contact reporter Han Wei (weihan@caixin.com)

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