Latest news with #US-U.K.
The Sun
10-05-2025
- Business
- The Sun
Ahead of China-US talks, Trump says 80% tariff 'seems right'
US President Donald Trump said on Friday an 80% tariff on Chinese goods 'seems right,' suggesting for the first time a specific alternative to the 145% levies he has imposed on Chinese imports ahead of closely watched weekend talks between the two countries. US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer will meet Chinese economic tsar He Lifeng in Switzerland to discuss containing a trade war between the world's two biggest economies. It could be the first step toward resolving a damaging conflict that has already entangled global supply chains. Asked how the president arrived at the 80% figure, White House spokeswoman Karoline Leavitt said, 'That was a number the president threw out there, and we'll see what happens this weekend.' Trump will not unilaterally bring down tariffs on China, however, she stressed. 'We need to see concessions from them as well,' she said. China is also sending a top public-security official to the talks in Geneva, a source familiar with the plans said. The development, first reported by the Wall Street Journal, is an indication of the importance of the issue of fentanyl trafficking to the talks and the wider US-China relationship. Trump cited the fentanyl scourge as the rationale for the initial imposition of punitive import taxes on goods from China, Canada and Mexico earlier this year. China's embassy in Washington did not respond to a request for comment. 'China should open up its market to USA – would be so good for them!!! Closed markets don't work anymore!!!' Trump wrote in an all-caps social media post. '80% tariff on China seems right. Up to Scott B.,' he added moments later. China's foreign ministry has decried what it calls abusive and bullying economic tactics and said that China remains firmly opposed to what it calls an unsustainable approach to trade by the US Ryan Majerus, partner with the King & Spalding law firm and a former senior Commerce Department official, said the expected decline in port and trade traffic may have created some pressure to start addressing the US-China trade impasse in Geneva. 'I don't see an easy off-ramp for either party,' he said. 'We could see a more limited agreement that lowers the tariff rates to a degree, depending on what China is willing to do.' The weekend talks come on the heels of Trump's first agreement with a major trading partner: Thursday's announcement of a pact with Britain. While that fueled some optimism in markets, it was fairly limited in scope, and a range of details still need to be hammered out. 'The US-U.K. trade agreement may be better than nothing, but it is not significant enough to warrant a change to our forecast,' Nancy Vanden Houten, lead US economist at Oxford Economics, wrote on Friday. 'While talks this weekend between US and Chinese officials may yield some progress, expectations for a significant reduction in tariffs seem unwarranted.' Oxford estimates that lowering tariffs on China to 80% would bring the overall effective import tax rate from all the tariffs imposed by Trump so far to 18% from around 22% now. That would still be three times what Oxford had estimated at the start of Trump's term and far above the 2-3% average from before he returned to office. US STOCKS MUTED While Trump has indicated on several occasions that he expects the punitive tariff rates on China to come down, he had not until now floated a precise alternative. Even though 80% is just around half the current rate, it remains extraordinarily high, above even the hefty 60% rate that Trump proposed while campaigning for president last year. It was not clear how it would be received by China amid what Bessent has already cast as an effective trade embargo between the two countries. What level tariff rates settle at – and not just for China – has been a central focus for investors rattled by months of financial market volatility arising from the chaotic rollout of Trump's aggressive trade policies. US stocks, which have recouped a significant chunk of their losses since mid-February's record high, finished slightly lower for the week after a quiet session on Friday. The dollar was weaker against a basket of major trading partners' currencies. Since taking office in January, Trump has hiked the tariffs paid by US importers for goods from China to 145%, in addition to those he imposed on many Chinese goods during his first term and the duties levied by the Biden administration. China hit back by imposing export curbs on some rare earth elements, vital for US manufacturers of weapons and electronic consumer goods, and raising tariffs on US goods to 125%. It also imposed extra levies on some products including soybeans and liquefied natural gas. Trump's push on tariffs is widely seen to be elevating risks to the US economy, with concerns that they will lift prices for American consumers and businesses while at the same time cutting into the demand that has so far propped up the job market. Trump is already facing dropping approval ratings over his handling of trade as Americans brace to pay more for clothes, electronics, toys and countless other goods that emerge from Chinese factories. China's government is seeking to mitigate closures, bankruptcies and job losses at manufacturers struggling to find viable alternatives to the US market. Representing the meeting's host, Swiss Vice President Guy Parmelin, who also serves as economic minister, emerged from separate bilateral meetings in Geneva with the US and Chinese delegations with optimistic words for reporters. 'It's already a success,' Parmelin said. 'The two sides are talking ... If a road map can emerge and they decide to continue discussions, that will lower the tensions.'
Business Recorder
09-05-2025
- Business
- Business Recorder
Australia, New Zealand currencies set for weekly loss as dollar makes comeback
SYDNEY: The Australian and New Zealand dollars are set for a weekly loss on Friday as a hawkish outlook on U.S interest rates lifted the battered greenback, though the direction of travel will now rest on progress in looming Sino-US trade talks at the weekend. The Aussie slipped 0.2% to $0.6387 having fallen 0.4% overnight away from a five-month peak of $0.6515 hit on Wednesday. It is set for a weekly loss of 0.9% to end four weeks of gain, with resistance now at the 200-day moving average of $0.6457. The kiwi dollar eased 0.3% to $0.5886 after losing 0.6% overnight, falling further from a six-month top of $0.6029 hit in late April. In a bearish sign, it broke the bottom of a recent trading range at $0.5894 but still has support at the 200-day moving average of $0.5882. The US dollar received much-needed support after the Federal Reserve held rates steady and signalled it was in no rush to ease. Overnight, futures scaled back the degree of expected policy easing this year to 68 basis points from 78 bps a day earlier. A US-U.K. trade deal has raised hope of progress in Sino-US talks in Switzerland on Saturday, giving the greenback breathing room amid chaos brought about by changing US trade action. US President Donald Trump has said tariffs on Chinese goods will come down from 145%. Australia, NZ dollars bounce on hopes for progress in US tariff stalemate 'The USD is likely to recover in the short-term as investors re-evaluate the change in tone on trade and the likelihood of market-friendly deals,' said Chang Wei Liang, a foreign exchange and credit strategist at DBS Bank. 'Though it is unclear whether his 'deals' could lead to a meaningful reduction in tariffs.' Despite the pull-back in Fed easing expectations, investors still assume the Reserve Bank of Australia will cut its cash rate by 25 basis points to 3.85% when it meets on May 20 given a slowdown in inflation and softness in consumer spending. Across the Tasman Sea, markets are still wagering heavily on a rate cut from the Reserve Bank of New Zealand this month to 3.25%. Swaps imply continued easing to a terminal rate of 2.75%. Westpac Banking on Friday pencilled in an extra RBNZ cut in July to 3%, citing downside risk to the economy from the United States' trade war and associated uncertainty. 'We don't think the RBNZ will be able to see its way through the fog of war by July or even August. Hence, it's likely they will continue to cut the OCR,' said Kelly Eckhold, chief economist at Westpac New Zealand.
CNBC
08-05-2025
- Business
- CNBC
Confidence around tariffs is improving with key China talks on deck
Wall Street cheered on Thursday as the first green shoots from President Donald Trump's trade negotiations emerged, one day before the one-month anniversary of the April 9 tariff pause and just ahead of key talks with China . Officials from the U.S. and United Kingdom announced that the countries have agreed to the outline of a trade deal . The news helped fuel a broad rally for stocks, with the small-cap Russell 2000 — a barometer for confidence about the economy — outperforming its large-cap counterparts in the session. .RUT 1D mountain Small cap stocks outperformed on Thursday. The U.K. agreement was not at the top of the priority list for investors worried about the global economy, but any progress is positive right now. "The US-U.K. trade deal is ultimately a positive development and a sign that after months of turmoil, we may be incrementally moving towards de-escalation of the global trade war," Martin Frandsen, equities portfolio manager at Principal Asset Management, said in a statement. The bullish hope is that incremental progress can build into something more substantial and certain. In particular, traders who bought stocks Thursday are implicitly betting that something positive will come from talks with China. Trump said Thursday he expects the scheduled discussions with Chinese officials this weekend to be "substantive." U.S. Trade Representative Jamieson Greer said on " Power Lunch " said that lowering tariffs on China as a result of those talks is "on the table." "We think this is an opportunity to find some stability with these folks. China's market and economy is so different from our own. It's so hard to fit a square into a circle in a way that's fair. So that's a much longer conversation. This talk is about can we get to a stable place, and maybe that's a foundation for something more," Greer said.
