Trump sees no Xi summit by tariff date, stocking trade worries

Elias Hubbard
February 10, 2019

Earlier, towards the end of January, President Trump revealed in a tweet that he would be expecting to meet his counterpart to negotiate on some of the most hard issues that the two countries have been holding for decades.

On Thursday, while acknowledging that Trump was still optimistic about a deal, Kudlow said, "We've got a pretty sizable distance to go here". Officials have reported little progress on contentious issues but remain hopeful that a deal will be struck. Trump and Xi last met in December in Argentina. Since then, the two countries have exchanged several rounds of trade tariffs.

He does anticipate the USA and China could reach a deal later this year to remove the tariffs, with the upcoming election cycle playing a role in the timing. Reuters reports the news has "prompted a sharp selloff in us stocks".

"Not yet", Trump told reporters at the White House when asked if a meeting had been arranged for within the next month. Hong Kong's Hang Seng Index saw a 0.50 percent decline, and Australia's ASX 200 was down 0.34 percent. Treasury bond yields dropped as investors sought safety in sovereign US debt.

The news prompted a sharp selloff in USA stocks, dashing the optimism that had been building that the countries were progressing toward a deal before tariffs on Chinese imports rise to 25 percent after the March 1 deadline.

Treasury Secretary Steven Mnuchin and trade representative Robert Lighthizer are leading a team to Beijing next week to continue talks aimed at resolving a costly trade war. "They're making a mistake because they need to be prepared", he said.

Early on Friday, New Zealand Prime Minister Jacinda Ardern said that the U.S. -Sino trade tensions could negatively impact her country's economy and hurt exporters, as China is New Zealand's top trade partner, generating NZ$16.6 billion in the 12-months prior to September 2018 (more than double the country's sales to the U.S.). While the US has said it's a hard deadline for the tariffs, Trump has also suggested he could agree to extend negotiations beyond month's end if progress is being made. He tweeted last week that he plans to meet the Xi to hammer out a deal.

"Trump meeting Xi makes it more likely any deal will last". Markets in China and Taiwan were closed.

A study released Wednesday by Tariffs Hurt the Heartland, a campaign opposed to tariffs, said an increase to 25% would reduce employment by 934,000 jobs and GDP by 0.37%.

Other reports by Click Lancashire

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