Did Trade Talks hit a deadlock?
U.S. President twitted that U.S.-China trade talks are “moving along nicely”, but any deal would need “a different structure”. This tweet, with no further explanations, cast a shadow over ongoing negotiations with China.
Our Trade Deal with China is moving along nicely, but in the end we will probably have to use a different structure in that this will be too hard to get done and to verify results after completion.
— Donald J. Trump (@realDonaldTrump) May 23, 2018
White House Representatives did not comment on this statement.
The U.S. Commerce Dept. announced that it would launch a national security investigation into vehicle imports. This investigation may lead to tariffs like those imposed on steel and aluminum in March.
Both China and USA on Monday put the war between them “on hold”. A win-win business cooperation seemed to begin between the two largest economies of the world. The two giants of the global economy agreed to set aside their dispute over trade tariffs.
On a Joint Statement on Trade Consultations they underlined that China will significantly increase purchases of United States goods and services. The whole statement set the framework for taking measures to reduce the US trade deficit in goods with China. US exports will focus on agriculture and energy. The two sides also agreed to expand trade in manufactured goods and services.
However, Trump on Tuesday told reporters he was not pleased with recent talks, calling them “a start”.
Negotiations over the nuclear weapons in North Korea also affected trade talks.
Further, the Pentagon withdrew its invitation to China from a US-led naval drill. This move is considered to be a response to Beijing’s militarization of South China Sea.
The US Dollar eased from its rally over uncertainty regarding the smooth development of US-China trade talks. Greenback headed lower against its rivals as well.
The Euro edged up from its 6-month low against US dollar. However, concerns over Italy instability and Europe economy downturn hold back further rise.
The Sterling slightly retreated after a new 5-month low boosted by UK retail sales data.
The Japanese Yen rose after Trump’s tweet mentioning that trade talks are “moving along nicely”, but any deal would need “a different structure”. Swiss Franc reacted like this as well.
Gold corrected slightly higher. The safe-haven metal continues its struggle as US dollar rally was unstoppable in recent days.
Oil prices moved lower following an increase in crude and gasoline inventories. Brent was 0.4 percent lower at $79.50 pb.
Sources: Reuters, Euronews, CNN Money
PLEASE NOTE The information above is not investment advice.