According to Han de Jong is Chief Economist of ABN AMRO, the recent announcement from China that their vice PM will lead their delegation at the next round of trade talks must be a good sign for the ongoing US-China trade conflict.
Key Quotes
“The more senior people tend only to come if their underlings have made sufficient progress. I also think both sides are aware of the risk of doing significant damage to their own economies by escalating the conflict. US president Trump will be starting to think of next year’s elections.”
“The last thing he needs is an economy in trouble or an extended bear market in equities. The best way for him to reduce such risks is to do a trade deal. He is a master at selling any deal as a victory, so it really doesn’t matter what the deal includes. The Wall Street Journal article claiming that US Treasury Secretary Steve Mnuchin would favour rolling back the tariffs imposed on imports from China (not confirmed) may also be a positive signal.”
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