Publicado: Mier, Diciembre 05, 2018
Financiera | Por Marilu Caballero

White House contradicts Trump, says there's no deal with China

White House contradicts Trump, says there's no deal with China

Futures point to a pop of roughly 2-2.5% on Wall Street, in line with the rises seen today on the Hang Seng and Shanghai Composite indices, and in Europe too.

The president tweeted optimistically about the chances for a deal with China, writing "President Xi and I want this deal to happen, and it probably will".

Here's what we do know: if both sides keep to their word, there won't be any new tariffs being lobbed around in the next few months.

Most particularly, one of the results of the G20 is that US President Donald Trump backtracked on plans of raising tariffs on $200 billion worth of Chinese products from 10 percent to 25 percent starting from January 1, 2019, stressing the necessity of talks with Beijing and threatening to persist with his plans if they don't move any further.

Another layer of uncertainty over the talks has been a lack of commitment by the Chinese to broker a deal within a 90-day window announced by the United States, commencing from the date of the dinner.

Most likely, though, China will try to find a way to circumvent the WTO policy, probably without openly flouting the global institution.

"China has to do this, basically to get room to breathe", said an executive at a state-owned trading house.

The editor in chief of The Daily Wire played "Free Market Avenger" to "Tariff Man" on Tuesday after the president's trade-war rhetoric with China shook the stock market.

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Trump's comments come after leaders of the world's two biggest economies agreed Saturday in Argentina to not impose any new tariffs on each other's exports for the next 90 days while they negotiate a detailed trade agreement.

China and the United States agreed on Saturday to a ceasefire in a months-long trade war that has roiled global markets and halted sales of USA soybeans to the world's top buyer. China has also agreed to buy more American farm goods, industrial goods, and energy, and to target fentanyl, a drug that has caused a large number of overdoses in America. Numerous so-called second wave of U.S. LNG projects that are now being planned and/or receiving federal approval will have a hard time reaching the all-important final investment decision (FID) needed to go forward without Chinese assistance.

Trump has been dissatisfied with existing global trade agreements in general but has paid particular attention to China.

Trump, in a series of Twitter posts, threatened to slap a range of import penalties on Chinese products if they did not make major changes in their economic relationship with the United States.

That means the death penalty, by the way, but anyhow, here's what China's Foreign Ministry said, again more vaguely: "China has made a decision to list all the fentanyl-like substances as controlled substances and start working to adjust related regulations".

Mr Trump has said China is supposed to start buying agricultural products immediately and cut its 40 per cent tariffs on U.S. auto imports.

Some vagueness is to be expected in a temporary, in-principle agreement such as that struck this weekend.

While Mnuchin said the president reserves the right to escalate tariffs should negotiations not pan out as planned, he cast the weekend's talks as a breakthrough in the administration's efforts to check China and said the discussion included everything from purchasing more U.S. goods to intellectual property, to currency manipulation. The development signals the most prominent gain since summer 2005, when China stripped its currency of domestic limitations and placed it into a more flexible, but volatile, foreign exchange domain.

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