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Robert Rennie, Head of Financial Market Strategy at Westpac, offered his take on the recent mixed messages over the prospects of a preliminary US-China trade deal.

Key Quotes:

“Back on the 11th October, US President Trump and China’s Vice Premier Liu He reached a truce in their trade war, after agreeing a limited deal which saw the US hold off on tariff increases that were due the following week in exchange for Chinese concessions on agricultural purchases.”
“The deal was expected to be signed within 5 weeks and global equity markets rose strongly through October and November on expectations for a pickup in global growth.”
“Six weeks have passed since the ‘phase-one’ deal was agreed in principle with no deal in place. Indeed only a week ago White House advisor Larry Kudlow claimed the two sides were down to “short strokes”, implying a deal was indeed close.”
“Markets are showing some signs of tiring of the steady drip feed of upbeat comments from US officials and no signs of a final agreement looking likely.”