China Trade Truce in the Making

China Trade Truce in the Making

China Trade Truce in the Making

The words in the air are that US Treasury Secretary Steven Mnuchin is considering a trip to China to moderate/mitigate a trade dispute with Beijing.

Secretary Mnuchin said he is “cautiously optimistic” of reaching an agreement with China that bridges their differences on trade.

“A trip is under consideration.”

Secretary Mnuchin told reporters Saturday in Washington, DC at the IMF’s spring meetings that, “I’m not going to make a comment on timing, nor do I have anything confirmed.”

A visit by the US Treasury secretary to China likely signals a breakthrough in the dust-up between the world’s 2-biggest economies, whose threats to slap tariffs on each other have rattled markets and raised fears of a trade war.

This come at a Key  time for the region’s geopolitics, with negotiations under way on a planned meeting between President Donald Trump and NKorean leader Kim Jong-Un.

Secretary Mnuchin’s remarks came as finance ministers and central bankers at the IMF meetings gave their latest economic assessments, often citing trade as a threat looming over the strongest upswing in seven years.

Global growth has strengthened and is increasingly broad based, the IMF’s main advisory committee said Saturday. However, it noted that “rising financial vulnerabilities, increasing trade and geopolitical tensions, and historically high global debt threaten global growth prospects.”

Secretary Mnuchin met with Yi Gang, governor of the People’s Bank of China (PBoC), at the IMF gathering this week. The discussions focused on issues related to the Chinese central bank, not trade. He said they also discussed China’s planned further opening of some markets, a move that US has encouraged and “appreciated.”

“China will vigorously push forward the reform and opening-up of the financial sector, significantly relax market access restrictions, create a more attractive investment environment, strengthen the protection of intellectual properties and actively expand imports,” Yi said in a statement  Saturday. China has announced plans to gradually remove foreign ownership caps for limits for car, ship. and aircraft-makers.

Secretary Mnuchin indicated he is now involved in a “dialogue” with the Chinese government to resolve the trade dispute. “We’re cautiously optimistic to see if we can try to reach an agreement.”

Have a terrific weekend

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