US-China trade talks seem to progress – Danske Bank
According to analysts at Danske Bank, the trade talks between the US and China seem to progress with fairly positive signals coming out of both Washington and Beijing.
“According to Bloomberg, China is ready to buy USD20bn of US agricultural products in the first year and over time could increase the amount to USD40-50bn if the US removes all tariffs in a ‘phase two deal’ later. Wall Street Journal broke a story over the weekend that US President Donald Trump’s economic adviser had arranged a meeting in the White House with outside experts who warned Trump that further escalation would hurt the US economy and his chances of re-election. Data on US capital goods orders this week added support to this view as they pointed to the first decline in US investments since Trump took over the oval office.”
“Trump’s hawkish trade adviser Peter Navarro said this week a ‘phase one’ deal would include intellectual property rights.”
“In his second China-focused speech in a year vice president, Mike Pence repeated his tough rhetoric on China.”
“We still look for a ‘phase 1’ deal to be signed in mid-November by US President Donald Trump and Chinese President Xi Jinping. It should pave the way for ‘phase 2’ negotiations which will have all the difficult pieces left to deal with and is likely to continue into 2020. However, with the US economy weakening Trump may aim to strike a deal next year to revive the recovery ahead of the November 2020 election.”