US, China extend talks on trade battle

Lloyd Doyle
January 9, 2019

When looking from technical perspective, daily chart hints at strong bearish grip on market as the pair is on decline for fifth consecutive session today extending last week's bearish slide from 19-month tops as Dollar bulls lack strong break out trigger. Meanwhile, "currencies are holding firm riding the wave sentiment from the positive buzz in U.S". On Tuesday, Hong Kong's Hang Seng index rose more than 2% and Japan's Nikkei more than 1%.

People familiar with the talks said the world's two largest economies were further apart on Chinese structural reforms that the Trump administration is demanding in order to stop alleged theft and forced transfer of USA technology and on how to hold Beijing to its promises. "China's development has ample tenacity and huge potential", Lu said.

Trump imposed tariff increases of up to 25 percent on $250 billion of Chinese imports over complaints Beijing steals or pressures companies to hand over technology.

"Talks with China are going very well!". Trump tweeted on Tuesday, the latest in a series of upbeat messages from him on the negotiations since both his meeting with Xi and the December market turmoil. A statement from the Chinese government was expected as soon as Wednesday. In public statements, aides such as Wilbur Ross, the USA commerce secretary, and Peter Navarro, a White House trade adviser, have played down the impact of the trade wars on markets, the United States economy and companies.

Scott Kennedy, director of the Project on Chinese Business and Political Economy at the Center for Strategic and International Studies in Washington, said the two sides for the first time were discussing topics that matter most to the Trump administration.

Neither side has given any indication its basic position has changed. The 90-day window expires in March.

China and the USA wrapped up three days of trade talks, with people familiar with the discussions saying their positions were closer on areas including energy and agriculture but further apart on harder issues. That might offer relief to rural areas that supported Trump in the 2016 election and were targeted by Chinese tariffs.

Oil prices rose 2 percent on Wednesday as the extension of US-China talks in Beijing raised hopes that the world's two largest economies would resolve their trade standoff.


Those include initiatives such as "Made in China 2025", which calls for state-led creation of Chinese global champions in robotics, artificial intelligence and other fields.

"We have shown our sincerity, we have established our stand in this, so we don't need other actions to gain the confidence of the US".

Beijing has tried in vain to recruit France, Germany, South Korea and other governments as allies against Trump, but they have echoed USA complaints about Chinese industrial policy and market barriers.

On Monday, Chinese importers made another large purchase of U.S. soybeans, their third in the past month. They complain China's companies are treated unfairly in national security reviews of proposed corporate acquisitions, though nearly all deals are approved unchanged.

The U.S. delegation was led by Deputy U.S. Trade Representative Jeffrey Gerrish and accompanied by senior officials from the White House, U.S. Trade Representative (USTR), and the U.S. Departments of Agriculture, Commerce, Energy, and Treasury, according to the USTR.

Fears of a global slowdown and weaker corporate earnings - exacerbated by billions of dollars in tit-for-tat tariffs between the United States and China - have led to a sharp pullback on markets over the last few months.

Chinese exports to the United States held up despite the tariff hikes, but that was due partly to exporters rushing to fill orders before any more increases hit.

The talks are occurring as Chinese growth - 6.5 percent in the July-to-September period - fell to its lowest point in a decade.

Other reports by Iphone Fresh

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