China’s vice premier to visit the US on May 9 for trade talks
On Tuesday, Asian markets managed to recover slightly with the Shanghai Composite Index and Shenzhen Composite Index rising higher by 0.78% and 1.58%, respectively, by midday.
China’s vice premier Liu He has confirmed his attendance to join the Chinese delegation that will be visiting the United States (US) for trade talks on May 9 to 10, as China attempts to get the talks back on track and to work around the latest tariff threats the US has said it would hike.
Mr Liu’s attendance on Thursday will comfort the markets as market watchers were expecting a higher probability for the US to hike the tariffs on US$200 billion worth of Chinese goods from 10% to 25% if the vice premier did not join the delegation.
The US is planning to increase the tariffs at 12.01am on May 10, US trade representative Robert Lighthizer had told reporters in Washington on Monday. But US treasury secretary Steven Mnuchin said in a CNBC report that there is a possibility for the US to reconsider hiking the duties if the trade talks get back on track.
On Sunday, Mr Trump tweeted that the current tariffs on US$200 billion worth of Chinese goods will rise to 25% on Friday, from the previous 10%. The US president also threatened to tax an additional US$325 billion worth of untaxed goods at 25%, as he deemed the trade talks to be progressing ‘too slowly’.
Mr Trump’s tweet response arrived after Mr Lighthizer updated him with details that China was pulling back from previous commitments.
Asian and US markets met with a turbulent trading day on Monday after Mr Trump’s tariff threat.
On Monday noon, the Shanghai Composite Index and Shenzhen Composite Index plunged by 5% and 7%, respectively, but the indices managed to recover slightly by Tuesday noon, rising higher by 0.78% and 1.58%.
Markets reacted positively on Tuesday in hopes that China will push ahead with the US trade talks and were also relieved that China had not reacted to US’ scares with retaliatory tariff threats.
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