Trump says China deal will mean 'very big spike' for markets

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According to The Wall Street Journal report on Friday, a US-China trade accord is facing a new roadblock, as Chinese officials balk at committing to a presidential summit until the two countries have a firm deal in hand.

America's trade deficit with China hit a record $419.2 billion a year ago, USA data released this week showed.

"Today's trade figures reinforce our view that China's trade recession has started to emerge", Australia and New Zealand Banking Group Ltd economist Raymond Yeung (楊宇霆) said in a note.

That left the country with a trade surplus of $4.12 billion for the month, much smaller than forecasts of $26.38 billion.

Exports dropped 20.7 percent in February, the biggest plunge since February 2016.

On Friday, however, Trump's ambassador to China, Terry Branstad, told The Wall Street Journal in an interview that no date has been set for a trade summit in Florida since talks are still continuing between United States and Chinese negotiators.

Imports also saw a sharper than expected fall of 5.2% year-on-year, the data showed.

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Kudlow told CNBC that talks have "advanced enormously", echoing comments from Chinese Foreign Minister Wang Yi earlier Friday.

Exports to Europe decreased 15.9 percent to US$2 billion and exports to Japan were down 4.4 percent to US$1.54 billion, the MOF said.

The governments of the world's two largest economies have been locked in a tit-for-tat tariff battle for months as Washington presses Beijing to address long-standing concerns over Chinese practices and policies around industrial subsidies, technology transfers, market access and intellectual property rights. The trade surplus had been tipped at US$26.38 billion last month from January's US$39.16 billion.

White House economic advisor Larry Kudlow acknowledged that Trump's planned meeting at his Florida resort with Chinese President Xi Jinping - which officials said was expected to be held late this month to seal an agreement - could slip into April. China's exports to all of its major markets fell across the board last month. Many analysts expect a rocky first half before a flurry of stimulus measures start to stabilize activity around mid-year.

This year the holiday fell early in February, pulling import demand forward into January, and thereby yielding weaker February numbers.

China's slowdown and the trade war are having an increasing impact on other trade-reliant countries and businesses worldwide.

USA and Chinese officials have said they are making progress toward a resolution of the dispute but a U.S. diplomat in Beijing said Friday that an agreement was not imminent.

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