"Phase one" trade deal with the United States has been reached, China announced on Friday as reported by news agency AFP.

Beijing added that Washington will be removing tariffs 'phase by phase,' AFP reported.&nbsp;

China's vice commerce minister Wang Shouwen said that part of the "phase one" trade deal with the US includes a progressive rollback of tariffs that have threatened to roil the global economy.

"The two countries have agreed on the text of a phase one trade and economic deal," Shouwen said at a news conference, adding that the two sides now have to sign the agreement.

On Wednesday, the Bloomberg had reported the US and China are moving closer to "agreeing on the amount of tariffs to be rolled back in a phase-one trade deal," news agency Reuters reported.

(With inputs from agencies)&nbsp;

"Phase one" trade deal with the United States has been reached, China announced on Friday as reported by news agency AFP. Beijing added that Washington will be removing tariffs 'phase by phase,' AFP reported.

"Phase one" trade deal with the United States has been reached, China announced on Friday as reported by news agency AFP. Beijing added that Washington will be removing tariffs 'phase by phase,' AFP reported. China's vice commerce minister Wang Shouwen said that part of the "phase one" trade deal with the US includes a progressive rollback of tariffs that have threatened to roil the global economy. "The two countries have agreed on the text of a phase one trade and economic deal," Shouwen said at a news conference, adding that the two sides now have to sign the agreement. On Wednesday, the Bloomberg had reported the US and China are moving closer to "agreeing on the amount of tariffs to be rolled back in a phase-one trade deal," news agency Reuters reported. (With inputs from agencies)

'Phase one' trade deal reached with US: China 

The United States was poised Thursday to announce a historic trade deal with China, days before new tariffs are due to kick in between the world's two largest economies, easing a commercial dispute that has roiled markets for almost two years.

The United States was poised Thursday to announce a historic trade deal with China, days before new tariffs are due to kick in between the world's two largest economies, easing a commercial dispute that has roiled markets for almost two years. Reports that Washington and Beijing had struck a bargain at last -- subject to approval by US President Donald Trump -- sent US stocks sailing to their first record closes of December. "Getting VERY close to a BIG DEAL with China. They want it, and so do we!" Trump tweeted in a markedly optimistic tone, although it was unclear if he would officially confirm the agreement on Thursday. Trump's flagging of an imminent breakthrough comes ahead of new tariffs planned to take effect Sunday and also just as he is almost sure to become only the third US president to be impeached. With his 2020 re-election battle heating up Trump is keen to seize the political initiative and show voters his punishing struggle with China has brought results. The US ultimately wants China to open its vast economy to more goods and to conduct sweeping reforms of what Washington has long called systemic abuse against foreign investors. Recently, though, White House officials have indicated they would settle for less in a so-called "phase one" deal. The Washington Post reported that Trump had signed off on a swap of tariff reductions in return for China spending $50 billion on US farm goods, tightening its intellectual property protections and opening its financial services markets. The paper cited Michael Pillsbury, a China expert at the Washington-based Hudson Institute it said had been briefed by Trump, and an unnamed senior administration official. The paper reported that plans for an official announcement had not been nailed down, adding that the administration does not intend to seek congressional approval. China's commerce ministry said Thursday the two sides were in "close" contact ahead of Sunday's deadline. Dodging new tariffs bullet In addition to existing tariffs, Trump had threatened to impose a 15 per cent levy Sunday on around $160 billion of Chinese exports, including popular US consumer goods like electronics and clothing. China had previously said it would respond with a 25 per cent tariff on US autos and a five per cent tariff on auto parts -- levies that were suspended earlier this year as a goodwill gesture. According to The Wall Street Journal, the US side is offering to scrap the threatened Sunday tariffs and also cut existing duties imposed on about $360 billion in Chinese goods. Trump's overall goal with China, a keystone of his presidency, is to uproot what Washington says are Beijing's predatory trade practices, including forced technology transfers and massive intellectual property theft. Trump himself has blown hot and cold, repeatedly insisting that China needs a deal more than the United States does. At the end of November, he said he was in the "final throes" of negotiations, but days later he spooked world financial markets when he said "I have no deadline" for a resolution. The intense talks, involving multiple trips by teams from both sides to and from Washington and Beijing, were further complicated by tensions over the pro-democracy uprising in Hong Kong. Trump, somewhat reluctantly, signed a law passed with overwhelming congressional support in November that backs the Hong Kong demonstrators. Beijing responded that the law was "abominable" and "sinister," but ultimately appeared to have little in the way of counter-measures.

US on verge of landmark China trade deal: Trump

China's foreign minister on Friday accused the United States of "seriously" damaging trust between the two countries amid tensions over human rights in Xinjiang and protests in Hong Kong.

The two countries have been locked in a trade dispute for almost two years, while rights issues in China's northwest region of Xinjiang and Hong Kong have further strained diplomatic relations.

The United States has "seriously damaged the foundation of hard-earned trust between China and the US," said Chinese Foreign Minister Wang Yi.

Speaking at a symposium on international affairs in Beijing, Wang said that Washington was "suppressing" China across a number of fields, including the economy, trade and technology.

The US has "deliberately attacked and discredited China on issues of national sovereignty and dignity," he added.

Last month, Washington drew the ire of the Chinese government by enacting a law supporting pro-democracy protests in Hong Kong, where six months of increasingly violent demonstrations have rocked the semi-autonomous financial hub.

It is the starkest challenge the city has presented to Beijing since its 1997 handover from Britain, which guaranteed freedoms unseen on the mainland -- rights that activists say are being eroded.&nbsp;

In retaliation, China last week imposed sanctions on US-based NGOs in the financial centre and suspended future visits by US warships to the semi-autonomous territory.

Beijing has also threatened even more punitive action pending the enactment of a Uighur rights bill in the US, which could sanction officials behind the mass detention of mostly Muslim ethnic minorities in Xinjiang.

On the trade war front, President Donald Trump tweeted Thursday that the two countries were "very close" to finalising a deal to de-escalate their dispute.

But Beijing declined to confirm a deal was imminent.

China's foreign minister on Friday accused the United States of "seriously" damaging trust between the two countries amid tensions over human rights in Xinjiang and protests in Hong Kong.

China's foreign minister on Friday accused the United States of "seriously" damaging trust between the two countries amid tensions over human rights in Xinjiang and protests in Hong Kong. The two countries have been locked in a trade dispute for almost two years, while rights issues in China's northwest region of Xinjiang and Hong Kong have further strained diplomatic relations. The United States has "seriously damaged the foundation of hard-earned trust between China and the US," said Chinese Foreign Minister Wang Yi. Speaking at a symposium on international affairs in Beijing, Wang said that Washington was "suppressing" China across a number of fields, including the economy, trade and technology. The US has "deliberately attacked and discredited China on issues of national sovereignty and dignity," he added. Last month, Washington drew the ire of the Chinese government by enacting a law supporting pro-democracy protests in Hong Kong, where six months of increasingly violent demonstrations have rocked the semi-autonomous financial hub. It is the starkest challenge the city has presented to Beijing since its 1997 handover from Britain, which guaranteed freedoms unseen on the mainland -- rights that activists say are being eroded. In retaliation, China last week imposed sanctions on US-based NGOs in the financial centre and suspended future visits by US warships to the semi-autonomous territory. Beijing has also threatened even more punitive action pending the enactment of a Uighur rights bill in the US, which could sanction officials behind the mass detention of mostly Muslim ethnic minorities in Xinjiang. On the trade war front, President Donald Trump tweeted Thursday that the two countries were "very close" to finalising a deal to de-escalate their dispute. But Beijing declined to confirm a deal was imminent.

China accuses US of 'seriously' damaging bilateral trust

US President Donald Trump who arrived in <a href="https://www.wionews.com/world/donald-trump-says-uk-pm-boris-johnson-very-capable-265958">London to attend the NATO </a>summit said he has "no deadline" for a trade deal with China while adding that he "could wait until after the election for the China deal".

"I have no deadline," Trump told reporters in London. "In some ways, I like the idea of waiting until after the election for the China deal."

The US president, however, was quick to add a deal would "surprise" everyone, asserting, "I don't know if I want to make it but you're going to find out pretty soon, it's going to surprise everybody."

"I'm doing very well in a deal with China, if I want to make it," Trump said at a press conference ahead of the NATO summit.

"I don't think it's 'if they want to make it', it's 'if I want to make it'. And we'll see what happens."

US and China have been locked in a trade war for the past 18 months with China recently demanding that US tariffs&nbsp;be rolled back as part of phase one of the trade deal.

Last week, President Trump had said the US was in the "final throes" of a deal aimed at defusing the trade war with China, however, the US president added that failure to get the trade deal will prompt more tariffs even as analysts fear it would result in lower sales in the Christmas season ahead.

Trump had earlier warned about 15 per cent additional tariffs on $156 billion worth of Chinese-made consumer goods scheduled to take effect on December 15. Trump had earlier agreed in October to skip raising those tariffs to 30 per cent from the 25 per cent rate.

A 15 per cent tariff on about $125 billion of goods had gone into effect on September 1, including flat-panel television sets, flash memory devices, smart speakers, Bluetooth headphones, bed linens, multifunction printers among other products. 
&nbsp;

US President Donald Trump who arrived in London to attend the NATO summit said he has "no deadline" for a trade deal with China while adding that he "could wait until after the election for the China deal".

US President Donald Trump who arrived in London to attend the NATO summit said he has "no deadline" for a trade deal with China while adding that he "could wait until after the election for the China deal". "I have no deadline," Trump told reporters in London. "In some ways, I like the idea of waiting until after the election for the China deal." The US president, however, was quick to add a deal would "surprise" everyone, asserting, "I don't know if I want to make it but you're going to find out pretty soon, it's going to surprise everybody." "I'm doing very well in a deal with China, if I want to make it," Trump said at a press conference ahead of the NATO summit. "I don't think it's 'if they want to make it', it's 'if I want to make it'. And we'll see what happens." US and China have been locked in a trade war for the past 18 months with China recently demanding that US tariffs be rolled back as part of phase one of the trade deal. Last week, President Trump had said the US was in the "final throes" of a deal aimed at defusing the trade war with China, however, the US president added that failure to get the trade deal will prompt more tariffs even as analysts fear it would result in lower sales in the Christmas season ahead. Trump had earlier warned about 15 per cent additional tariffs on $156 billion worth of Chinese-made consumer goods scheduled to take effect on December 15. Trump had earlier agreed in October to skip raising those tariffs to 30 per cent from the 25 per cent rate. A 15 per cent tariff on about $125 billion of goods had gone into effect on September 1, including flat-panel television sets, flash memory devices, smart speakers, Bluetooth headphones, bed linens, multifunction printers among other products.

I like the idea of waiting until after election for China trade deal: Trump

Beijing is insisting US tariffs must be rolled back as part of any phase one trade deal with Washington, China's Global Times newspaper said on Sunday citing unnamed sources, amid continued uncertainty on whether the two sides can strike a deal.

Beijing is insisting US tariffs must be rolled back as part of any phase one trade deal with Washington, China's Global Times newspaper said on Sunday citing unnamed sources, amid continued uncertainty on whether the two sides can strike a deal. "A US pledge to scrap tariffs scheduled for December 15 cannot replace the rollbacks of tariffs," the newspaper said in a tweet, referring to an additional round of tariffs on Chinese imports to be implemented in the absence of a trade deal. The Global Times is published by the People's Daily, the official newspaper of China's ruling Communist Party. On Tuesday, US President Donald Trump said Washington was in the "final throes" of a deal aimed at defusing a 16-month trade war with China, a few days after Chinese President Xi Jinping had expressed his desire for a trade agreement. Top trade negotiators for both countries also spoke again and agreed to continue working on the remaining issues. Trade experts and people close to the White House told Reuters last month, however, that signing of a phase one agreement may not take place until the new year as China pressed for more extensive rollbacks of tariffs. An agreement was initially expected to be completed by the end of November. US Senate Finance Committee Chairman Chuck Grassley told reporters on Tuesday that Beijing invited US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin for in-person talks in Beijing. Grassley said Lighthizer and Mnuchin were willing to go if they saw "a real chance of getting a final agreement". A source familiar with the trade talks also told Reuters that U.S. officials could travel to China after Thursday's Thanksgiving holiday in the United States.

China wants US tariffs rolled back in phase one trade deal: Report

US stocks slipped on Friday in a post-holiday shortened session as a US-China discord over Hong Kong reignited trade tensions and retail stocks dipped on signs of a tepid start to in-store Black Friday sales.

China on Thursday threatened to retaliate against a US law backing pro-democracy protesters in Hong Kong. The measures could include barring drafters of the legislation from mainland China, Hong Kong and Macau, the editor of China's state-backed Global Times tabloid said in a tweet.

The trade-sensitive Philadelphia Semiconductor index fell as much as 0.8 per cent and was on track for its worst day in a week.

The diplomatic clash also knocked Wall Street's main indexes off record highs. They had closed at all-time highs in every session so far this week on upbeat domestic data and hopes of an imminent "phase one" trade deal.

"The fact that this is a half-day with the markets being at all-time highs is a reason to give investors a bit of a pause," said Robert Pavlik, chief investment strategist, at SlateStone Wealth LLC in New York.

The sentiment was also dulled by reports of spot checks on retailers around the country, which showed fewer people lining up outside stores at the start of Black Friday, suggesting a surge in online buying may have taken the shine off America's biggest shopping day.

The S&amp;P 500 retail sector fell 0.7 per cent, with Kohl's Corp dropping 2.3 per cent. But top retailers Walmart Inc and Best Buy Co Inc were up between 0.3% and 0.7%.

At 11:48 a.m. ET the Dow Jones Industrial Average was down 95.45 points, or 0.34 per cent, at 28,068.55, while the S&amp;P 500 was down 8.63 points, or 0.27per cent, at 3,145. The Nasdaq Composite was down 21.73 points, or 0.25%, at 8,683.45.

Shares of Tech Data Corp jumped 12.3 per cent&nbsp;as private equity firm Apollo Global Management raised its bid for the US information technology equipment distributor to about $5.14 billion.

Declining issues outnumbered advancers for a 1.58-to-1 ratio on the NYSE and for a 1.18-to-1 ratio on the Nasdaq. The S&amp;P index recorded 15 new 52-week highs and one new low, while the Nasdaq recorded 66 new highs and 26 new lows.

US stocks slipped on Friday in a post-holiday shortened session as a US-China discord over Hong Kong reignited trade tensions and retail stocks dipped on signs of a tepid start to in-store Black Friday sales.

US stocks slipped on Friday in a post-holiday shortened session as a US-China discord over Hong Kong reignited trade tensions and retail stocks dipped on signs of a tepid start to in-store Black Friday sales. China on Thursday threatened to retaliate against a US law backing pro-democracy protesters in Hong Kong. The measures could include barring drafters of the legislation from mainland China, Hong Kong and Macau, the editor of China's state-backed Global Times tabloid said in a tweet. The trade-sensitive Philadelphia Semiconductor index fell as much as 0.8 per cent and was on track for its worst day in a week. The diplomatic clash also knocked Wall Street's main indexes off record highs. They had closed at all-time highs in every session so far this week on upbeat domestic data and hopes of an imminent "phase one" trade deal. "The fact that this is a half-day with the markets being at all-time highs is a reason to give investors a bit of a pause," said Robert Pavlik, chief investment strategist, at SlateStone Wealth LLC in New York. The sentiment was also dulled by reports of spot checks on retailers around the country, which showed fewer people lining up outside stores at the start of Black Friday, suggesting a surge in online buying may have taken the shine off America's biggest shopping day. The S&P 500 retail sector fell 0.7 per cent, with Kohl's Corp dropping 2.3 per cent. But top retailers Walmart Inc and Best Buy Co Inc were up between 0.3% and 0.7%. At 11:48 a.m. ET the Dow Jones Industrial Average was down 95.45 points, or 0.34 per cent, at 28,068.55, while the S&P 500 was down 8.63 points, or 0.27per cent, at 3,145. The Nasdaq Composite was down 21.73 points, or 0.25%, at 8,683.45. Shares of Tech Data Corp jumped 12.3 per cent as private equity firm Apollo Global Management raised its bid for the US information technology equipment distributor to about $5.14 billion. Declining issues outnumbered advancers for a 1.58-to-1 ratio on the NYSE and for a 1.18-to-1 ratio on the Nasdaq. The S&P index recorded 15 new 52-week highs and one new low, while the Nasdaq recorded 66 new highs and 26 new lows.

Wall Street slips as US law on Hong Kong brings back trade fears

Equity benchmark indices were in the negative terrain during early hours on Friday amid persistent global concerns over the US-China trade deal.

At 10:15 am, the BSE S&amp;P Sensex was down by 112 points at 40,463 while the Nifty 50 slipped by 32 points to 11,936. Sectoral indices at the National Stock Exchange were mixed with Nifty IT dropping by 2.1 per cent.

Software major Infosys tumbled by 2.78 per cent to Rs 693.40 per share while Wipro and Tech Mahindra were down by 1.9 per cent each, HCL Technologies by 1.8 per cent and Tata Consultancy Services by 1.7 per cent.

The other losers were Bharti Infratel, Bharti Airtel, Cipla, UPL and Titan.

However, NTPC gained by 2.6 per cent at Rs 118.35 per share after Morgan Stanley upgraded the power utility major to 'overweight' from 'equal weight' earlier with a target price of Rs 152.

Index heavyweight Reliance Industries also added gains of 1.7 per cent while the other gainers included Power Grid Corporation, Zee Entertainment, Sun Pharma, ITC, Vedanta and Tata Steel.

Meanwhile, Asian equities posted mild gains amid persistent worries over the status of trade negotiations between China and the United States.

MSCI's broadest index of Asia Pacific shares outside Japan climbed by 0.12 per cent on worries that the US legislation on Hong Kong threatens to undermine trade talks between the world's two largest economies.

Chinese blue-chip shares were down by 0.82 per cent but Japan's Nikkei was up by 0.43 per cent.

Equity benchmark indices were in the negative terrain during early hours on Friday amid persistent global concerns over the US-China trade deal. At 10:15 am, the BSE S&P Sensex was down by 112 points at 40,463 while the Nifty 50 slipped by 32 points to 11,936.

Equity benchmark indices were in the negative terrain during early hours on Friday amid persistent global concerns over the US-China trade deal. At 10:15 am, the BSE S&P Sensex was down by 112 points at 40,463 while the Nifty 50 slipped by 32 points to 11,936. Sectoral indices at the National Stock Exchange were mixed with Nifty IT dropping by 2.1 per cent. Software major Infosys tumbled by 2.78 per cent to Rs 693.40 per share while Wipro and Tech Mahindra were down by 1.9 per cent each, HCL Technologies by 1.8 per cent and Tata Consultancy Services by 1.7 per cent. The other losers were Bharti Infratel, Bharti Airtel, Cipla, UPL and Titan. However, NTPC gained by 2.6 per cent at Rs 118.35 per share after Morgan Stanley upgraded the power utility major to 'overweight' from 'equal weight' earlier with a target price of Rs 152. Index heavyweight Reliance Industries also added gains of 1.7 per cent while the other gainers included Power Grid Corporation, Zee Entertainment, Sun Pharma, ITC, Vedanta and Tata Steel. Meanwhile, Asian equities posted mild gains amid persistent worries over the status of trade negotiations between China and the United States. MSCI's broadest index of Asia Pacific shares outside Japan climbed by 0.12 per cent on worries that the US legislation on Hong Kong threatens to undermine trade talks between the world's two largest economies. Chinese blue-chip shares were down by 0.82 per cent but Japan's Nikkei was up by 0.43 per cent.

Equities downbeat on trade worries, Nifty IT down by over 2%

Gold held steady on Tuesday, after hitting its highest since November&nbsp;7 earlier in the session, as doubts about a trade deal between the United States and China dented risk sentiment.

Spot gold was little changed at $1,471.90 per ounce as of 0559 GMT.

US&nbsp;gold futures inched up 0.07 per cent&nbsp;to $1,472.90 per ounce.

"We're not seeing any big moves at the moment and given the proximity to the $1,490-level, movements will be sideways in the short term, unless Beijing or Washington come and say that a trade deal is unlikely," said Michael McCarthy, chief market strategist at CMC Markets.

Asian share markets were mixed as another day awaiting clearer news on the progress of the trade negotiations left investors bereft of trading motivation.

Overnight, CNBC had reported the mood in Beijing was pessimistic about the prospects of sealing an agreement.

"The to and fro between the two parties surrounding the first phase of the deal is keeping prices in a tight range," ANZ analyst Daniel Hynes said.

"Lingering global economic scenario and a weaker dollar is providing some support to gold."

The dollar held near a two-week low.

Market participants also kept a close eye on the unrest in<a href="https://www.wionews.com/.../china-appoints-new-police-chief-in-hong-kong- 263113"> Hong Kong</a>, with dozens of protesters in the financial hub staging a dramatic escape from a university campus sealed off by police on Monday.

Gold is considered a safe store of value during economic or political uncertainties.

The focus now shifts to minutes from the US&nbsp;Federal Reserve's last policy meeting this year, due on Wednesday.

The Fed cut rates three times this year in part to offset what it views as damage done by the <a href="https://www.wionews.com/.../china-us-had-constructive-phone-call-on-trade- report-262656">tariff war</a>. But after their meeting in October, policymakers signalled they would lower rates no further unless the economy took a serious turn for the worse.

"It is worth noting that recent gains (in gold) have been led by fast-money interest in the face of (exchange traded fund) ETF outflows, positioning that is fickle amid price volatility," according to MKS PAMP.

Holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.6 per cent&nbsp;to 891.79 tonnes on Monday from Friday.

Elsewhere, silver rose 0.6 per cent&nbsp;to $17.12 per ounce, while palladium fell 0.3 per cent&nbsp;to $1,732.93 per ounce.

Platinum advanced 0.5 per cent to $898.10 per ounce.

Gold held steady on Tuesday, after hitting its highest since November 7 earlier in the session, as doubts about a trade deal between the United States and China dented risk sentiment.

Gold held steady on Tuesday, after hitting its highest since November 7 earlier in the session, as doubts about a trade deal between the United States and China dented risk sentiment. Spot gold was little changed at $1,471.90 per ounce as of 0559 GMT. US gold futures inched up 0.07 per cent to $1,472.90 per ounce. "We're not seeing any big moves at the moment and given the proximity to the $1,490-level, movements will be sideways in the short term, unless Beijing or Washington come and say that a trade deal is unlikely," said Michael McCarthy, chief market strategist at CMC Markets. Asian share markets were mixed as another day awaiting clearer news on the progress of the trade negotiations left investors bereft of trading motivation. Overnight, CNBC had reported the mood in Beijing was pessimistic about the prospects of sealing an agreement. "The to and fro between the two parties surrounding the first phase of the deal is keeping prices in a tight range," ANZ analyst Daniel Hynes said. "Lingering global economic scenario and a weaker dollar is providing some support to gold." The dollar held near a two-week low. Market participants also kept a close eye on the unrest in Hong Kong, with dozens of protesters in the financial hub staging a dramatic escape from a university campus sealed off by police on Monday. Gold is considered a safe store of value during economic or political uncertainties. The focus now shifts to minutes from the US Federal Reserve's last policy meeting this year, due on Wednesday. The Fed cut rates three times this year in part to offset what it views as damage done by the tariff war. But after their meeting in October, policymakers signalled they would lower rates no further unless the economy took a serious turn for the worse. "It is worth noting that recent gains (in gold) have been led by fast-money interest in the face of (exchange traded fund) ETF outflows, positioning that is fickle amid price volatility," according to MKS PAMP. Holdings of the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell 0.6 per cent to 891.79 tonnes on Monday from Friday. Elsewhere, silver rose 0.6 per cent to $17.12 per ounce, while palladium fell 0.3 per cent to $1,732.93 per ounce. Platinum advanced 0.5 per cent to $898.10 per ounce.

Gold prices steady as US-China trade deal doubts linger

China and United States had "constructive talks" on trade in a high-level phone call on Saturday, news agency Reuters reported quoting state media Xinhua. China's Vice Premier Liu He, US trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin in a phone call discussed each other's core issues for the first phase of an initial trade agreement and agreed to maintain close communication, according to Xinhua.

China and United States had "constructive talks" on trade in a high-level phone call on Saturday, news agency Reuters reported quoting state media Xinhua. China's Vice Premier Liu He, US trade representative Robert Lighthizer and Treasury Secretary Steven Mnuchin in a phone call discussed each other's core issues for the first phase of an initial trade agreement and agreed to maintain close communication, according to Xinhua. Xinhua gave no other details in its report on Sunday. White House economic adviser Larry Kudlow said on Thursday the two countries were getting close to an agreement about ending their 16-month trade war, but he gave no further details on the timing of a possible deal. The US and China are locked in a tariff war that have roiled financial markets and threatened to drag growth in the global economy to its lowest rate since the 2007-2008 financial crisis. An agreement had appeared likely in May, but those prospects were dashed after US negotiators said China backed away from the text of a draft agreement. Concerns flared again last week amid reports that the trade talks had hit a snag over how and when to reduce tariffs, and how much U.S. agricultural products China would commit to buy.

China, US had 'constructive' phone call on trade: Report

China and the United States have agreed to roll back tariffs on each others' goods in a "phase one" trade deal if it is completed, officials from both sides said on Thursday, sparking division among some advisers to President Donald Trump.

China and the United States have agreed to roll back tariffs on each others' goods in a "phase one" trade deal if it is completed, officials from both sides said on Thursday, sparking division among some advisers to President Donald Trump. The Chinese commerce ministry, without laying out a timetable, said the two countries had agreed to cancel the tariffs in phases. A US official, speaking on condition of anonymity, confirmed the rollback would be part of the first phase of a trade agreement that is still being put to paper for Trump and President Xi Jinping to sign. White House spokeswoman Stephanie Grisham told Fox News Channel the United States is "very, very optimistic" about completing a deal that would defuse a 16-month trade war between the world's two largest economies. "I cannot get ahead of the talks with China, but we are very, very optimistic that we will reach a deal soon," she said. Experts warn the pact could still fall apart. US officials said a lot of work remained to be done when Trump announced the outlines of an interim deal last month. Trump has used tariffs on billions of dollars of Chinese goods as his primary weapon in the protracted trade war. The prospect of lifting them, even in phases, has drawn fierce opposition from advisers in and outside of the White House who remain wary of giving up a key aspect of US leverage. US stocks pared gains after Reuters reported that the plan faced internal opposition. "There is no specific agreement for a phased rollback of the tariffs," said Michael Pillsbury, an outside adviser to Trump. "The American side has been ambiguous when and which tariffs will be lifted. The Chinese have some wishful thinking and are trying to soothe their domestic hardliners that the tariffs will someday come off." If an interim deal is finished and signed, it is widely expected to include a US pledge to scrap tariffs scheduled for December 15 on about $156 billion worth of Chinese imports, including cell phones, laptop computers and toys. Tariff cancellation was an important condition for any agreement, Chinese Commerce Ministry spokesman Gao Feng said, adding that both must simultaneously cancel some tariffs on each other's goods to reach the phase one pact. "Both sides have agreed to cancel additional tariffs in different phases, as both sides make progress in their negotiations," Gao told a regular briefing. A spokesman for the US Treasury department declined to comment and the U.S. Trade Representative's office did not immediately respond to a request for comment. Republican lawmakers are urging the Trump administration to tie any tariff rollbacks to Beijing's compliance with specific elements of the agreement. "The tariffs should be phased out piece by piece as China complies," one congressional source said. Trump-Xi meeting In what could be another gesture to boost optimism, China's state news agency Xinhua reported late on Thursday that the Chinese customs and Ministry of Agriculture are considering removing restrictions on US poultry imports. China has banned all US poultry and eggs since January 2015 due to an avian influenza outbreak. The optimism over a phase one trade deal boosted stocks globally; bond yields shuffled higher. A source previously told Reuters that Chinese negotiators wanted the United States to drop 15% tariffs on about $125 billion worth of Chinese goods that took effect on Sept. 1. They also sought relief from earlier 25% tariffs on about $250 billion of imports, ranging from machinery and semiconductors to furniture. A person familiar with China's negotiating position said it was pressing Washington to "remove all tariffs as soon as possible". A deal may be signed before the end of the year by Trump and Xi at a yet-to-be determined location. Dozens of venues have been suggested for a meeting, which had originally been set to take place on the sidelines of a now-cancelled mid-November summit of Asia-Pacific leaders in Chile, a senior Trump administration official told Reuters on Wednesday. One possible location was London, where the leaders could meet after a NATO summit that Trump is due to attend from Dec. 3-4, the official said. Gao declined to say when and where such a meeting could be. Since Trump took office in 2017, his administration has been pressing China to curb massive subsidies to state-owned firms and end the forced transfer of American technology to Chinese firms as a price of doing business in China. The president's tough stance on China has earned him praise from his political base, and he may be reluctant to appear conciliatory on the issue going into his 2020 re-election campaign. But Trump has also sought to portray stock market gains as a reflection of his stewardship of the economy, and the market has reacted positively to any hints of an end to the two countries' trade dispute.

China, US agree tariff rollback if phase one trade deal is completed

Europe's share markets hit a more than 4-year peak and bond yields shuffled higher on Thursday, as Beijing signalled a 'phase 1' <a href="http://13.235.153.162/world/china-says-it-has-agreed-with-united-states-to-cancel-tariffs-in-phases-260538">trade deal</a> with the United States was close to being sealed.

Asia had been quiet overnight but things sparked just before Europe opened when China's commerce ministry said the world's two economic giants were working on a deal that would roll back trade tariffs in different stages.

Cue optimism. The pan-European STOXX 600 index&nbsp;rose 0.4 percent&nbsp;to its highest since July 2015 led by the export-heavy DAX&nbsp;percent&nbsp;in Frankfurt despite worse-than-expected German industrial output data.

European government bond yields -- which move inverse to the price -- rose too. Benchmark Bund yields were heading towards their highest in more than three months while the dollar took background from the safe-haven yen in the currency markets.

"Everything is moving together for now on this trade deal news," said Saxo Bank's head of FX strategy John Hardy. "The question is, how much was already baked into the cake and can we really see more specifics?" he added.

Among the top gainers across European sub-sectors were automakers&nbsp;and miners,&nbsp;while defensive plays such as telecoms and utilities fell, which all pointed to higher risk appetite.

E-Mini futures for the S&amp;P 500, which has already set a new record high this week, were also a solid 0.5&nbsp;percent&nbsp;better off.

Asia, in contrast, had barely budged. MSCI's broadest index of Asia-Pacific shares outside Japan&nbsp;dipped a slight 0.2 percent, just off a six-month high hit earlier in the week.

Japan's Nikkei dithered either side of flat in very quiet trade, having touched a 13-month top on Wednesday. South Korean stocks&nbsp;stalled after hitting their highest since May, while Shanghai blue chips&nbsp;eked out a 0.2&nbsp;percent&nbsp;rise.

Reuters reported on Wednesday that a meeting between US&nbsp;President Donald Trump and Chinese President Xi Jinping to sign the interim trade deal could be delayed until December as discussions continue over terms and venue.

Among various suggestions was to sign a deal after a scheduled NATO meeting in London in early December.

"One could take the view that by not committing to meet the original deadline it gives more time for a somewhat more comprehensive agreement to be thrashed out," said Ray Attrill, head of FX strategy at National Australia Bank.

The overnight pause in the risk rally helped US&nbsp;bonds recoup a little of their recent losses. Yields on benchmark US&nbsp;10-year notes fell back to 1.84&nbsp;percent&nbsp;from a two-month top of 1.87 percent&nbsp;.

That kept the dollar in check, it was at 109.00 yen&nbsp;from a weekly high of 109.24 and was a smidgen lower on a basket of currencies at 97.965.

The euro was trying to sustain a bounce at $1.1079 previously close to chart support at $1.1060.

Spot gold was little changed at $1,490.38 per ounce and well within recent tight trading ranges.

Oil prices clawed higher after taking a hit from a surprisingly large build in US&nbsp;crude inventories.

US&nbsp;crude&nbsp;was 57 cents higher at $56.92 a barrel, while Brent crude made 5&nbsp;cents to $62.23.

Europe's share markets hit a more than 4-year peak and bond yields shuffled higher on Thursday, as Beijing signalled a 'phase 1' trade deal with the United States was close to being sealed.

Europe's share markets hit a more than 4-year peak and bond yields shuffled higher on Thursday, as Beijing signalled a 'phase 1' trade deal with the United States was close to being sealed. Asia had been quiet overnight but things sparked just before Europe opened when China's commerce ministry said the world's two economic giants were working on a deal that would roll back trade tariffs in different stages. Cue optimism. The pan-European STOXX 600 index rose 0.4 percent to its highest since July 2015 led by the export-heavy DAX percent in Frankfurt despite worse-than-expected German industrial output data. European government bond yields -- which move inverse to the price -- rose too. Benchmark Bund yields were heading towards their highest in more than three months while the dollar took background from the safe-haven yen in the currency markets. "Everything is moving together for now on this trade deal news," said Saxo Bank's head of FX strategy John Hardy. "The question is, how much was already baked into the cake and can we really see more specifics?" he added. Among the top gainers across European sub-sectors were automakers and miners, while defensive plays such as telecoms and utilities fell, which all pointed to higher risk appetite. E-Mini futures for the S&P 500, which has already set a new record high this week, were also a solid 0.5 percent better off. Asia, in contrast, had barely budged. MSCI's broadest index of Asia-Pacific shares outside Japan dipped a slight 0.2 percent, just off a six-month high hit earlier in the week. Japan's Nikkei dithered either side of flat in very quiet trade, having touched a 13-month top on Wednesday. South Korean stocks stalled after hitting their highest since May, while Shanghai blue chips eked out a 0.2 percent rise. Reuters reported on Wednesday that a meeting between US President Donald Trump and Chinese President Xi Jinping to sign the interim trade deal could be delayed until December as discussions continue over terms and venue. Among various suggestions was to sign a deal after a scheduled NATO meeting in London in early December. "One could take the view that by not committing to meet the original deadline it gives more time for a somewhat more comprehensive agreement to be thrashed out," said Ray Attrill, head of FX strategy at National Australia Bank. The overnight pause in the risk rally helped US bonds recoup a little of their recent losses. Yields on benchmark US 10-year notes fell back to 1.84 percent from a two-month top of 1.87 percent . That kept the dollar in check, it was at 109.00 yen from a weekly high of 109.24 and was a smidgen lower on a basket of currencies at 97.965. The euro was trying to sustain a bounce at $1.1079 previously close to chart support at $1.1060. Spot gold was little changed at $1,490.38 per ounce and well within recent tight trading ranges. Oil prices clawed higher after taking a hit from a surprisingly large build in US crude inventories. US crude was 57 cents higher at $56.92 a barrel, while Brent crude made 5 cents to $62.23.

US-China trade deal hopes restart stocks rally

China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a "phase one" US-China trade deal, people familiar with the negotiations said on Monday.

The deal, which may be signed later this month by Trump and Chinese President Xi Jinping at a yet-to-be-determined location, is widely expected to include a US pledge to scrap tariffs scheduled for Dec. 15 on about $156 billion worth of Chinese imports, including cell phones, laptop computers and toys.

A US official said the fate of the December 15 tariffs is being considered as part of negotiations and a potential signing trip this month.

Another source briefed on the talks said Chinese negotiators want Washington to drop 15% tariffs on about $125 billion worth of Chinese goods that went into effect on September 1. They are also seeking relief from earlier 25% tariffs on about $250 billion of imports from machinery and semiconductors to furniture.

A person familiar with Beijing's negotiating position said that China is continuing to press Washington to "remove all tariffs as soon as possible."

China's request to remove the September 1 duties was earlier reported by Politico, citing sources. The Financial Times newspaper also reported the White House was considering whether to roll back the Sept. 1 tariffs, which cover some clothing items, flat-screen televisions, smart speakers and Bluetooth headphones.

Ralph Winnie, director of the China program at the Eurasia Center, said wrapping up the interim trade pact would provide a boost to both the US and Chinese economies, while handing Trump an important win among farmers - a core constituency.

"It’s in both countries’ interest to have this trade deal," Winnie said. "If he seals the deal, it will be looked on very favourably by the American people. It’s a win-win for both countries."

Speaking on Tuesday at an import fair aimed at burnishing China's free-trade credentials, President Xi Jinping called on countries to stand against protectionism and reiterated pledges to continue to open China's economy and strengthen protection of intellectual property rights.

Foreign governments and business groups have become sceptical of Chinese reform promises and have longed warned that China would invite retaliation if it didn't match the openness of its trading partners.

Copyrights, not subsidies

Since Trump took office in 2017, his administration has been pressing China to curb massive subsidies to state-owned firms and end the forced transfer of American technology to Chinese firms as a price of doing business in China.

Analysts say the phase one deal will fail to adequately address these issues, focusing largely on Chinese purchases of US farm goods and intellectual property protection related to copyright and trademark issues. It will not address industrial subsidies at all.

China was requesting some changes to the text, but parts of the agreement are “very close to finished,” including the text on financial services, said a US source briefed on the negotiations. The text on agriculture was “dozens of pages long and nearly completed,” the source said.

“It is important to both sides to get this agreement across the finish line,” said the source, adding that the two presidents were very likely to meet before the end of the month.

Charles Boustany, a former congressman from Louisiana and counsellor at the National Bureau of Asian Research, said any initial agreement would likely be short-term in nature and unstable.

"Even though there's some talk about a phase one agreement, we don't think it’s going to be substantive in terms of addressing any of the structural problems," he said. "It would largely be a status quo situation where China continues to do what it’s doing."

Some business groups complain that a central component of the "phase one" deal - increased access to China's financial services market - will fall short of its promises, because of inconsistencies in China's new foreign investment law.

In comments submitted to the Chinese government by the US Chamber of Commerce, the American Chamber of Commerce in China and the US Information Technology Office, the groups pointed out that Beijing's draft regulations "do not address clear differences between the treatment of China's state-owned enterprises and the private sector," according to a person familiar with the comments.

Trump had said on Friday that negotiations on the initial phase agreement were going well and he hoped to sign the deal with Xi at a US location when work on the deal was completed.

China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a "phase one" US-China trade deal, people familiar with the negotiations said on Monday.

China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a "phase one" US-China trade deal, people familiar with the negotiations said on Monday. The deal, which may be signed later this month by Trump and Chinese President Xi Jinping at a yet-to-be-determined location, is widely expected to include a US pledge to scrap tariffs scheduled for Dec. 15 on about $156 billion worth of Chinese imports, including cell phones, laptop computers and toys. A US official said the fate of the December 15 tariffs is being considered as part of negotiations and a potential signing trip this month. Another source briefed on the talks said Chinese negotiators want Washington to drop 15% tariffs on about $125 billion worth of Chinese goods that went into effect on September 1. They are also seeking relief from earlier 25% tariffs on about $250 billion of imports from machinery and semiconductors to furniture. A person familiar with Beijing's negotiating position said that China is continuing to press Washington to "remove all tariffs as soon as possible." China's request to remove the September 1 duties was earlier reported by Politico, citing sources. The Financial Times newspaper also reported the White House was considering whether to roll back the Sept. 1 tariffs, which cover some clothing items, flat-screen televisions, smart speakers and Bluetooth headphones. Ralph Winnie, director of the China program at the Eurasia Center, said wrapping up the interim trade pact would provide a boost to both the US and Chinese economies, while handing Trump an important win among farmers - a core constituency. "It’s in both countries’ interest to have this trade deal," Winnie said. "If he seals the deal, it will be looked on very favourably by the American people. It’s a win-win for both countries." Speaking on Tuesday at an import fair aimed at burnishing China's free-trade credentials, President Xi Jinping called on countries to stand against protectionism and reiterated pledges to continue to open China's economy and strengthen protection of intellectual property rights. Foreign governments and business groups have become sceptical of Chinese reform promises and have longed warned that China would invite retaliation if it didn't match the openness of its trading partners. Copyrights, not subsidies Since Trump took office in 2017, his administration has been pressing China to curb massive subsidies to state-owned firms and end the forced transfer of American technology to Chinese firms as a price of doing business in China. Analysts say the phase one deal will fail to adequately address these issues, focusing largely on Chinese purchases of US farm goods and intellectual property protection related to copyright and trademark issues. It will not address industrial subsidies at all. China was requesting some changes to the text, but parts of the agreement are “very close to finished,” including the text on financial services, said a US source briefed on the negotiations. The text on agriculture was “dozens of pages long and nearly completed,” the source said. “It is important to both sides to get this agreement across the finish line,” said the source, adding that the two presidents were very likely to meet before the end of the month. Charles Boustany, a former congressman from Louisiana and counsellor at the National Bureau of Asian Research, said any initial agreement would likely be short-term in nature and unstable. "Even though there's some talk about a phase one agreement, we don't think it’s going to be substantive in terms of addressing any of the structural problems," he said. "It would largely be a status quo situation where China continues to do what it’s doing." Some business groups complain that a central component of the "phase one" deal - increased access to China's financial services market - will fall short of its promises, because of inconsistencies in China's new foreign investment law. In comments submitted to the Chinese government by the US Chamber of Commerce, the American Chamber of Commerce in China and the US Information Technology Office, the groups pointed out that Beijing's draft regulations "do not address clear differences between the treatment of China's state-owned enterprises and the private sector," according to a person familiar with the comments. Trump had said on Friday that negotiations on the initial phase agreement were going well and he hoped to sign the deal with Xi at a US location when work on the deal was completed.

China presses Trump for more tariff roll-backs in 'phase one' trade deal

Indian shares extended gains on Tuesday on increasing hopes of a trade truce between the United States and China, while optimism around solid, consumer-driven economic growth in the US aided sentiment.

The NSE Nifty 50 Index inched up 0.13% at 11,956.05, as at 0350 GMT, while the S&amp;P BSE Sensex index rose 0.19% to 40,385.03.

MSCI's broadest index of Asia-Pacific shares outside Japan ticked up 0.1% after hitting a four-month high in the previous session.

In the United States, all three major stock indexes posted record closing highs on Monday, after US officials indicated that a trade deal with China could be signed this month.

In domestic markets, private sector lender Yes Bank Ltd was the top gainer on the NSE index, rising as much as 8.84% to its highest since Oct. 31.

This pushed the Nifty Private bank index 0.3% higher.

The Nifty PSU Bank index, which tracks the country's state-run lenders, advanced 0.5%. It was on track for an eighth straight session of gains, with shares of Allahabad Bank gaining as much as 1.81%.

The Nifty auto index rose as much as 0.62%, with shares of Tata Motors Ltd rising over 1.5%.

Mahindra and Mahindra's shares were flat after the company said it will recall a limited batch of XUV300 vehicles to fix a faulty suspension component.

Meanwhile, Prime Minister Narendra Modi said on Monday that India will not join a China-led regional trade pact as it failed to address Delhi's concerns over market access.

Among losers, shares of Bharat Electronics Ltd fell as much as 4.94%, its lowest in nearly two weeks, after the firm reported a drop in quarterly profit on Monday.

Indian Overseas Bank slid over 14% after the bank posted a wider quarterly loss.

The Nifty IT index inched lower, with shares of software services firm Tata Consultancy Services Ltd shedding over half a per cent.

The FMCG index, which tracks fast-moving consumer goods, was down 0.56%. Shares of Dabur India Ltd fell 0.67%. The company will report quarterly numbers later in the day.

Tech Mahindra Ltd and PNB Housing Finance Ltd rose 0.65% and 2.57%, respectively. Both companies will report quarterly results later in the day.

Indian shares extended gains on Tuesday on increasing hopes of a trade truce between the United States and China, while optimism around solid, consumer-driven economic growth in the US aided sentiment.

Indian shares extended gains on Tuesday on increasing hopes of a trade truce between the United States and China, while optimism around solid, consumer-driven economic growth in the US aided sentiment. The NSE Nifty 50 Index inched up 0.13% at 11,956.05, as at 0350 GMT, while the S&P BSE Sensex index rose 0.19% to 40,385.03. MSCI's broadest index of Asia-Pacific shares outside Japan ticked up 0.1% after hitting a four-month high in the previous session. In the United States, all three major stock indexes posted record closing highs on Monday, after US officials indicated that a trade deal with China could be signed this month. In domestic markets, private sector lender Yes Bank Ltd was the top gainer on the NSE index, rising as much as 8.84% to its highest since Oct. 31. This pushed the Nifty Private bank index 0.3% higher. The Nifty PSU Bank index, which tracks the country's state-run lenders, advanced 0.5%. It was on track for an eighth straight session of gains, with shares of Allahabad Bank gaining as much as 1.81%. The Nifty auto index rose as much as 0.62%, with shares of Tata Motors Ltd rising over 1.5%. Mahindra and Mahindra's shares were flat after the company said it will recall a limited batch of XUV300 vehicles to fix a faulty suspension component. Meanwhile, Prime Minister Narendra Modi said on Monday that India will not join a China-led regional trade pact as it failed to address Delhi's concerns over market access. Among losers, shares of Bharat Electronics Ltd fell as much as 4.94%, its lowest in nearly two weeks, after the firm reported a drop in quarterly profit on Monday. Indian Overseas Bank slid over 14% after the bank posted a wider quarterly loss. The Nifty IT index inched lower, with shares of software services firm Tata Consultancy Services Ltd shedding over half a per cent. The FMCG index, which tracks fast-moving consumer goods, was down 0.56%. Shares of Dabur India Ltd fell 0.67%. The company will report quarterly numbers later in the day. Tech Mahindra Ltd and PNB Housing Finance Ltd rose 0.65% and 2.57%, respectively. Both companies will report quarterly results later in the day.

Sensex, Nifty inch up on trade deal optimism

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points.

Optimism over trade also boosted other trade-reliant currencies, such as the Australian and New Zealand dollars, which rose as much as half a per cent.

China is pushing US&nbsp;President Donald Trump to remove more tariffs imposed in September as part of a "<a href="https://www.wionews.com/world/united-states-china-close-to-finalising-part-of-a-phase-one-trade-deal-report-258209">phase one</a>" US-China trade deal, which is expected to be signed later this month, people familiar with the negotiations said.

The yuan jumped 0.6 per cent to the highest since August&nbsp;5 at 6.9930. The onshore yuan also posted its strongest close since August&nbsp;2.&nbsp;

The currency held its gains even after China's central bank cut its one-year medium-term lending facility (MLF) rate for the first time since early 2016, though it opted for a 5 bps cut that Commerzbank called "tiny".

"It might be fair to say the PBoC only fine-tuned its monetary policy stance ... Typically, a rate cut will bring depreciation pressure to the currency," Commerzbank told clients, adding the trade optimism was the main factor driving the yuan above the 7 mark.

China and the US&nbsp;have imposed tariffs on each other's goods in a trade war that has dragged on for 16 months and raised the spectre of a global recession. Resolving the row would boost riskier assets, ease concern about the economic outlook and reduce the need for aggressive monetary easing.

The US&nbsp;dollar was flat against a basket of currencies&nbsp;in early London trading but advanced around a quarter per cent against the safe-haven yen and Swiss franc.

Kit Juckes, head of FX strategy at Société Générale, said the agreement would probably mark a truce rather than peace but added that "the chance of getting a first-stage deal seems to be quite good."

The optimism spilt over into other currencies, with the Australian dollar not far off three-month highs. It wasn't much moved after the central bank left monetary policy unchanged, as expected. The kiwi dollar rose 0.3 per cent.

The Norwegian and Swedish crowns also rose versus both the dollar and euro.

The euro was flat against the dollar. It rose 0.26 percent&nbsp;versus the yen.

Jukes said the euro would be one of the last currencies to benefit from improved risk sentiment, noting that Monday's data showing Polish manufacturing activity in its sharpest downturn in 10 years had taken the wind out of the euro's sails.

Central European states such as Poland are a key market and investment destination for eurozone companies.

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points.

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points. Optimism over trade also boosted other trade-reliant currencies, such as the Australian and New Zealand dollars, which rose as much as half a per cent. China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a "phase one" US-China trade deal, which is expected to be signed later this month, people familiar with the negotiations said. The yuan jumped 0.6 per cent to the highest since August 5 at 6.9930. The onshore yuan also posted its strongest close since August 2. The currency held its gains even after China's central bank cut its one-year medium-term lending facility (MLF) rate for the first time since early 2016, though it opted for a 5 bps cut that Commerzbank called "tiny". "It might be fair to say the PBoC only fine-tuned its monetary policy stance ... Typically, a rate cut will bring depreciation pressure to the currency," Commerzbank told clients, adding the trade optimism was the main factor driving the yuan above the 7 mark. China and the US have imposed tariffs on each other's goods in a trade war that has dragged on for 16 months and raised the spectre of a global recession. Resolving the row would boost riskier assets, ease concern about the economic outlook and reduce the need for aggressive monetary easing. The US dollar was flat against a basket of currencies in early London trading but advanced around a quarter per cent against the safe-haven yen and Swiss franc. Kit Juckes, head of FX strategy at Société Générale, said the agreement would probably mark a truce rather than peace but added that "the chance of getting a first-stage deal seems to be quite good." The optimism spilt over into other currencies, with the Australian dollar not far off three-month highs. It wasn't much moved after the central bank left monetary policy unchanged, as expected. The kiwi dollar rose 0.3 per cent. The Norwegian and Swedish crowns also rose versus both the dollar and euro. The euro was flat against the dollar. It rose 0.26 percent versus the yen. Jukes said the euro would be one of the last currencies to benefit from improved risk sentiment, noting that Monday's data showing Polish manufacturing activity in its sharpest downturn in 10 years had taken the wind out of the euro's sails. Central European states such as Poland are a key market and investment destination for eurozone companies.

Chinese yuan surges to three-month high on trade optimism, 'tiny' rate cut

US&nbsp;President Donald Trump on Friday said he thinks a trade deal between the United States and China will be signed by the time the Asia-Pacific Economic Cooperation meetings take place in Chile on November&nbsp;16 and 17.

Chinese Vice Premier Liu He will provide Beijing's perspective on the progress of the talks in a speech on Saturday, according to a tweet&nbsp;from the editor-in-chief of the Global Times, a tabloid published by the People's Daily of China's ruling Communist Party.

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<blockquote class="twitter-tweet">
Based on what I know, Chinese Vice Premier Liu He will make authoritative interpretation on progress of China-US trade talks from China's perspective in his speech at the 2019 World Conference on VR Industry today.
— Hu Xijin 胡锡进 (@HuXijin_GT) <a href="https://twitter.com/HuXijin_GT/status/1185330748183601152?ref_src=twsrc%5Etfw">October 18, 2019</a></blockquote>
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"I think it will get&nbsp;signed&nbsp;quite easily, hopefully by the summit in Chile, where President Xi and I will both be,"&nbsp;Trump&nbsp;told reporters at the White House, without providing details.

"We're working with&nbsp;China&nbsp;very well,"&nbsp;Trump&nbsp;also said.

The White House has announced that&nbsp;China&nbsp;agreed to buy up to $50 billion&nbsp;of&nbsp;US&nbsp;farm products annually, as part of the first phase of a&nbsp;trade&nbsp;deal, although&nbsp;China&nbsp;seems slow to follow through.

The so-called phase 1&nbsp;deal&nbsp;was unveiled at the White House last week during a visit by vice-premier He as part of a bid to end a tit-for-tat&nbsp;trade&nbsp;war between Beijing and Washington that has roiled markets and hammered global growth.&nbsp;US&nbsp;officials said the second phase of negotiations could address thornier issues&nbsp;like forced technology transfer and non-financial services issues.

US President Donald Trump on Friday said he thinks a trade deal between the United States and China will be signed by the time the Asia-Pacific Economic Cooperation meetings take place in Chile on November 16 and 17.

US President Donald Trump on Friday said he thinks a trade deal between the United States and China will be signed by the time the Asia-Pacific Economic Cooperation meetings take place in Chile on November 16 and 17. Chinese Vice Premier Liu He will provide Beijing's perspective on the progress of the talks in a speech on Saturday, according to a tweet from the editor-in-chief of the Global Times, a tabloid published by the People's Daily of China's ruling Communist Party. Based on what I know, Chinese Vice Premier Liu He will make authoritative interpretation on progress of China-US trade talks from China's perspective in his speech at the 2019 World Conference on VR Industry today. — Hu Xijin 胡锡进 (@HuXijin_GT) October 18, 2019 × "I think it will get signed quite easily, hopefully by the summit in Chile, where President Xi and I will both be," Trump told reporters at the White House, without providing details. "We're working with China very well," Trump also said. The White House has announced that China agreed to buy up to $50 billion of US farm products annually, as part of the first phase of a trade deal, although China seems slow to follow through. The so-called phase 1 deal was unveiled at the White House last week during a visit by vice-premier He as part of a bid to end a tit-for-tat trade war between Beijing and Washington that has roiled markets and hammered global growth. US officials said the second phase of negotiations could address thornier issues like forced technology transfer and non-financial services issues.

Trump hopes US-China trade deal will be signed by middle of November

Oil prices rose on Tuesday after US President Donald Trump predicted a trade deal with China after positive comments by Beijing, calming nerves after a round of tit-for-tat tariff hikes had sent markets reeling.

Brent crude was up by 25 cents, or 0.4%, at $58.95 a barrel by 0214 GMT, after falling 1% in the previous session, dropping for the third day in a row.

US crude was up by 30 cents or 0.6% at $53.94 a barrel, having also dropped 1% on Monday for the fourth day of declines.

Trump on Monday said he believed China was sincere about wanting to reach a deal, while Chinese Vice Premier Liu He said China was willing to resolve the dispute through "calm" negotiations, settling global markets.

"For now, the street is in thrall to the President's comments, with financial markets doing abrupt changes of direction on his words that wouldn't look out of place in Fast and the Furious film," said Jeffrey Halley, senior market analyst at OANDA.

Oil prices have fallen around 20% from 2019 high reached in April, in part because of worries that the US-China trade conflict is hurting the global economy, which could dent demand for oil.

China's Commerce Ministry said last week it would impose additional tariffs of 5% or 10% on a total of 5,078 products originating from the United States, including crude oil, agricultural products and small aircraft.

In retaliation, Trump said he was ordering US companies to look at ways to close operations in China and make products in the United States.

"Unless you believe a trade deal will happen the slowdown in the global economy continues ... and earnings all over the globe will be under pressure," said Greg McKenna, strategist at McKenna Macro.

The measures are prompting reactions from Chinese companies, with Sinopec seeking a tariff exemption for importing US oil in the coming months, sources told Reuters.

Meanwhile, US crude oil and gasoline inventories likely fell last week, while distillate stockpiles rose, a preliminary Reuters poll showed on Monday.

Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.1 million barrels in the week to August 23.

Oil prices rose on Tuesday after US President Donald Trump predicted a trade deal with China after positive comments by Beijing, calming nerves after a round of tit-for-tat tariff hikes had sent markets reeling.

Oil prices rose on Tuesday after US President Donald Trump predicted a trade deal with China after positive comments by Beijing, calming nerves after a round of tit-for-tat tariff hikes had sent markets reeling. Brent crude was up by 25 cents, or 0.4%, at $58.95 a barrel by 0214 GMT, after falling 1% in the previous session, dropping for the third day in a row. US crude was up by 30 cents or 0.6% at $53.94 a barrel, having also dropped 1% on Monday for the fourth day of declines. Trump on Monday said he believed China was sincere about wanting to reach a deal, while Chinese Vice Premier Liu He said China was willing to resolve the dispute through "calm" negotiations, settling global markets. "For now, the street is in thrall to the President's comments, with financial markets doing abrupt changes of direction on his words that wouldn't look out of place in Fast and the Furious film," said Jeffrey Halley, senior market analyst at OANDA. Oil prices have fallen around 20% from 2019 high reached in April, in part because of worries that the US-China trade conflict is hurting the global economy, which could dent demand for oil. China's Commerce Ministry said last week it would impose additional tariffs of 5% or 10% on a total of 5,078 products originating from the United States, including crude oil, agricultural products and small aircraft. In retaliation, Trump said he was ordering US companies to look at ways to close operations in China and make products in the United States. "Unless you believe a trade deal will happen the slowdown in the global economy continues ... and earnings all over the globe will be under pressure," said Greg McKenna, strategist at McKenna Macro. The measures are prompting reactions from Chinese companies, with Sinopec seeking a tariff exemption for importing US oil in the coming months, sources told Reuters. Meanwhile, US crude oil and gasoline inventories likely fell last week, while distillate stockpiles rose, a preliminary Reuters poll showed on Monday. Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.1 million barrels in the week to August 23.

Oil rises as US-China trade comments calm markets

Asian shares sank on Monday as the latest salvo in the Sino-US&nbsp;trade war shook confidence in the world economy and sent investors steaming to the safe harbours of sovereign bonds and gold, while slugging emerging market currencies.

Yields on benchmark 10-year Treasury debt dropped to their lowest since mid-2016, while gold hit its highest since April 2013 as risk was shunned.

There was some relief that China fixed the yuan's midpoint at a relatively steady 7.0570 per dollar when it had been trading as weak as 7.1850 offshore, countering concerns Beijing would let the currency slide to keep exports competitive.

MSCI's broadest index of Asia-Pacific shares outside Japan still shed 2.0%, and Australia 1.5%.

Japan's Nikkei lost 2.3%, while Shanghai blue chips fell 1.2%. E-Mini futures for the S&amp;P 500 eased 0.8%, and EUROSTOXX 50 futures 1.1%.

Wall Street nose-dived on Friday when President Donald Trump announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of US products.

At the G7 meeting in France over the weekend, Trump caused some confusion by indicating he may have had second thoughts on the tariffs.

But the White House said on Sunday that Trump wished he had raised tariffs on Chinese goods even higher last week, even as he signalled he did not plan to follow through with a demand that US&nbsp;firms close operations in China.

Trump is now set to hold a joint news conference with French President Emmanuel Macron later on Monday.

"There is an uneasy feeling that the very fragile negotiations are spiralling out of control," wrote analysts at ANZ in a note.

"The escalation suggests uncertainty will continue to weigh on global trade, industrial production and investment, with no sign of a resolution."

The latest broadside overshadowed a pledge by Federal Reserve Chair Jerome Powell to "act as appropriate" to keep the US economy healthy, although he stopped short of committing to rapid-fire rate cuts.

The markets clearly believe, however, the Fed will have to act aggressively and are fully priced for at least a quarter-point cut in September and more than 110 basis points of easing by the end of 2020.

"Trump shows no signs of moderating his destructive trade policies," said JPMorgan analyst Adam Crisafulli.

"Central banks can't fully ameliorate the downside of a global trade war," he added. "Companies will enter lockdown mode in terms of spending, and eventually hiring, until at least the November 2020 election amid all the uncertainty."

Yields race lower

Yields on 10-year Treasury notes were down at 1.48%, having dived from a top of 1.66% on Friday, leaving them almost matching two-year yields.

"We continue to remain long 10's, targeting 1.3% due to a combination of weakness in the global economy and trade war uncertainty filtering through into a weaker US economy," said Priya Misra, head of global rates strategy at TD Securities.

"This will force the Fed to ease beyond a 'mid-cycle adjustment to policy'," he added. "We believe that the market is underpricing the risks of additional rate cuts in 2020."

The drop in yields initially swept the legs out from under the dollar, which slid 0.5% on Friday against a basket of currencies and was last trading at 97.654.

It took an early hit on the yen to touch 104.47, but pared the losses as the session wore on and was last at 105.21. The next major chart point is a low around 104.10 briefly touched during the "flash crash" of early January.

The euro was firm at $1.1143, having climbed 0.6% on Friday, although restrained somewhat by speculation the European Central Bank will also have to ease aggressively next month.

The dollar fared better elsewhere, making inroads on most emerging market currencies. The Turkish lira briefly tumbled as far as 6.4700 per dollar at one stage.

Spot gold got a boost from the slide in yields, rising 1.1% to $1,544.23 per ounce and touching its highest since April 2013.

Oil prices went the other way on worries the tariffs dispute would crimp world demand.

Brent crude futures slid 68 cents to $58.66, while US crude lost 79 cents to $53.38 a barrel.

Asian shares sank on Monday as the latest salvo in the Sino-US trade war shook confidence in the world economy and sent investors steaming to the safe harbours of sovereign bonds and gold, while slugging emerging market currencies.

Asian shares sank on Monday as the latest salvo in the Sino-US trade war shook confidence in the world economy and sent investors steaming to the safe harbours of sovereign bonds and gold, while slugging emerging market currencies. Yields on benchmark 10-year Treasury debt dropped to their lowest since mid-2016, while gold hit its highest since April 2013 as risk was shunned. There was some relief that China fixed the yuan's midpoint at a relatively steady 7.0570 per dollar when it had been trading as weak as 7.1850 offshore, countering concerns Beijing would let the currency slide to keep exports competitive. MSCI's broadest index of Asia-Pacific shares outside Japan still shed 2.0%, and Australia 1.5%. Japan's Nikkei lost 2.3%, while Shanghai blue chips fell 1.2%. E-Mini futures for the S&P 500 eased 0.8%, and EUROSTOXX 50 futures 1.1%. Wall Street nose-dived on Friday when President Donald Trump announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of US products. At the G7 meeting in France over the weekend, Trump caused some confusion by indicating he may have had second thoughts on the tariffs. But the White House said on Sunday that Trump wished he had raised tariffs on Chinese goods even higher last week, even as he signalled he did not plan to follow through with a demand that US firms close operations in China. Trump is now set to hold a joint news conference with French President Emmanuel Macron later on Monday. "There is an uneasy feeling that the very fragile negotiations are spiralling out of control," wrote analysts at ANZ in a note. "The escalation suggests uncertainty will continue to weigh on global trade, industrial production and investment, with no sign of a resolution." The latest broadside overshadowed a pledge by Federal Reserve Chair Jerome Powell to "act as appropriate" to keep the US economy healthy, although he stopped short of committing to rapid-fire rate cuts. The markets clearly believe, however, the Fed will have to act aggressively and are fully priced for at least a quarter-point cut in September and more than 110 basis points of easing by the end of 2020. "Trump shows no signs of moderating his destructive trade policies," said JPMorgan analyst Adam Crisafulli. "Central banks can't fully ameliorate the downside of a global trade war," he added. "Companies will enter lockdown mode in terms of spending, and eventually hiring, until at least the November 2020 election amid all the uncertainty." Yields race lower Yields on 10-year Treasury notes were down at 1.48%, having dived from a top of 1.66% on Friday, leaving them almost matching two-year yields. "We continue to remain long 10's, targeting 1.3% due to a combination of weakness in the global economy and trade war uncertainty filtering through into a weaker US economy," said Priya Misra, head of global rates strategy at TD Securities. "This will force the Fed to ease beyond a 'mid-cycle adjustment to policy'," he added. "We believe that the market is underpricing the risks of additional rate cuts in 2020." The drop in yields initially swept the legs out from under the dollar, which slid 0.5% on Friday against a basket of currencies and was last trading at 97.654. It took an early hit on the yen to touch 104.47, but pared the losses as the session wore on and was last at 105.21. The next major chart point is a low around 104.10 briefly touched during the "flash crash" of early January. The euro was firm at $1.1143, having climbed 0.6% on Friday, although restrained somewhat by speculation the European Central Bank will also have to ease aggressively next month. The dollar fared better elsewhere, making inroads on most emerging market currencies. The Turkish lira briefly tumbled as far as 6.4700 per dollar at one stage. Spot gold got a boost from the slide in yields, rising 1.1% to $1,544.23 per ounce and touching its highest since April 2013. Oil prices went the other way on worries the tariffs dispute would crimp world demand. Brent crude futures slid 68 cents to $58.66, while US crude lost 79 cents to $53.38 a barrel.

Asian shares slugged, bonds bought amid trade gloom

Indian stock indexes ended almost 1% higher on Wednesday, after Washington delayed tariffs on some Chinese imports, bringing relief to markets across Asia.

The benchmark NSE Nifty ended 0.95% higher at 11,029.40, while the benchmark BSE Sensex closed down 0.96% at 37,311.53.

Shares in Tata Steel Ltd, Jindal Steel and Power Ltd and Vedanta Ltd were among the top gainers on the NSE index, gaining amid a rise in commodity prices.

The Nifty metal index, which has slid nearly 24% since the beginning of the year, rose 2.3%.

Indian stock indexes ended almost 1% higher on Wednesday, after Washington delayed tariffs on some Chinese imports, bringing relief to markets across Asia. The benchmark NSE Nifty ended 0.

Indian stock indexes ended almost 1% higher on Wednesday, after Washington delayed tariffs on some Chinese imports, bringing relief to markets across Asia. The benchmark NSE Nifty ended 0.95% higher at 11,029.40, while the benchmark BSE Sensex closed down 0.96% at 37,311.53. Shares in Tata Steel Ltd, Jindal Steel and Power Ltd and Vedanta Ltd were among the top gainers on the NSE index, gaining amid a rise in commodity prices. The Nifty metal index, which has slid nearly 24% since the beginning of the year, rose 2.3%.

Nifty, Sensex end higher after Trump delays China tariffs

By Bill Durodie

On June 28 and 29, the G20 summit will convene for the 14th time in Osaka, Japan. This gathering of leaders from the world’s leading economies, including the EU, plus invited guests and international organisations, ought to offer an important moment for mature reflection and collective coordination regarding the future needs of the world economy at a difficult time.

Instead, it is likely to descend either into directly confrontational rhetoric or, alternatively, empty promises and vague platitudes that avoid its mission to be the “premier forum for international economic cooperation”. The focus could end up being on more peripheral matters such as climate change, counter-terrorism, health and migration that are perceived of as being less contentious but should not be fundamental concerns of the G20.

The G20 is no stranger to crisis. It emerged from the 1997-98 Asian Financial Crisis that led G7 finance ministers (representing almost half of world GDP) to establish a wider group in order to engage with the major emerging economies. Then, in the wake of the 2007-08 global financial crisis, the group was further elevated to become a forum for heads of state.

In 2019, it is the continuing dispute between the US and China over trade that appears to loom largest. But this ought not be the main focus of the G20 either. As is well understood, trade wars are symptoms of underlying economic problems rather than their cause. The main focus ought to be on addressing those.

Trade and tariffs are not the fundamental drivers of growth and prosperity. Rather, these derive from domestic productivity levels in the making of goods and services that are, in their turn, driven by investment. To trade effectively, the key is to have something worth selling in the first place.

Tariffs, regulation, barriers

Unfortunately, the protectionist measures that had hastened the advent of World War II, and that were dismantled subsequently through the establishment of the GATT/WTO, led instead to a growing proliferation of non-tariff or technical barriers to trade. Rather than invest in new industries, older ones were sustained artificially behind a chaff of regulatory standards, intellectual property laws, state subsidies and public procurement policies.

Accordingly, assertions that we have been living through a time marked by a so-called “rules-based international trading system” fall very wide of the mark. All the evidence points to systematic attempts by the key players – and the United States in particular – to subvert any supposed “liberal world order”, both economically and militarily.

Now it may be, of course, that President Trump – who is certainly not the first US, or other, world leader to engage in such embargoes against China – understands full well that to compete internationally as a successful exporter it is the ability to produce efficiently at home that matters more than trade deals. Some of his pronouncements have reflected as much, looking to put pressure on manufacturers, such as Harley-Davidson and Nike, to bring their production back to its origins.

But, irrespective, the adverse effects of this approach are evident for all to see. Many American firms have warned the US Department of Commerce that such measures hurt both businesses and consumers alike. The latter invariably bear the brunt of any related price increases.

The IMF has cut its world economic growth forecast in accordance. And anyway, many enterprises will simply relocate elsewhere, such as to Vietnam, which is not currently on the receiving end of such additional duties.

A risky game

The deeper consequences, though, will take more time to become manifest. These include growing differences among the Western powers over how to handle the economic rise of the East.

This was seen recently, through the US stance towards its partners not using the Chinese firm Huawei to develop critical 5G infrastructure, despite its being the leading global player in the field. Such actions could come to damage relations with key allies, such as the UK and Germany.

In this regard, the US is playing a very risky game. With its relations veering towards a potential conflict with Iran, as well as its ongoing disputes with Russia and China, the US may yet come to rue antagonising its friends as well.

Or, at the very least, it may regret making them have to choose between their relations with the US and China. Only this week, the UK chancellor, Phillip Hammond launched the new Shanghai-London Stock Connect that looks set to deepen financial relations by facilitating investment between them.

This, and China’s recent decision not to pursue WTO market economy status, may also point to a growing maturity on its part in relation to such matters. Certainly, its most successful strategy in the past was always to keep a low profile on the international stage and avoid confrontation in foreign affairs, while focusing more on its domestic concerns.

Historically, it has often been extraneous circumstances that have accelerated change in world affairs more than any conscious push. The two powers that dominated each of the last two preceding centuries – the US and UK – did so as much through the decline and imperial overreach of their predecessors as through their own efforts. That, and its underlying crisis of innovation and investment, are what the US leadership would do well to reflect upon most in Osaka.

(Bill Durodie is Professor and Chair of International Relations, University of Bath)

(This article was originally published on The Conversation. Read the <a href="https://theconversation.com/g20-us-china-trade-war-points-to-the-real-crisis-that-global-leaders-must-confront-119359">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)&nbsp; 
&nbsp;

By Bill Durodie On June 28 and 29, the G20 summit will convene for the 14th time in Osaka, Japan. This gathering of leaders from the world’s leading economies, including the EU, plus invited guests and international organisations, ought to offer an important moment for mature reflection and collective coordination regarding the future needs of the world economy at a difficult time.

By Bill Durodie On June 28 and 29, the G20 summit will convene for the 14th time in Osaka, Japan. This gathering of leaders from the world’s leading economies, including the EU, plus invited guests and international organisations, ought to offer an important moment for mature reflection and collective coordination regarding the future needs of the world economy at a difficult time. Instead, it is likely to descend either into directly confrontational rhetoric or, alternatively, empty promises and vague platitudes that avoid its mission to be the “premier forum for international economic cooperation”. The focus could end up being on more peripheral matters such as climate change, counter-terrorism, health and migration that are perceived of as being less contentious but should not be fundamental concerns of the G20. The G20 is no stranger to crisis. It emerged from the 1997-98 Asian Financial Crisis that led G7 finance ministers (representing almost half of world GDP) to establish a wider group in order to engage with the major emerging economies. Then, in the wake of the 2007-08 global financial crisis, the group was further elevated to become a forum for heads of state. In 2019, it is the continuing dispute between the US and China over trade that appears to loom largest. But this ought not be the main focus of the G20 either. As is well understood, trade wars are symptoms of underlying economic problems rather than their cause. The main focus ought to be on addressing those. Trade and tariffs are not the fundamental drivers of growth and prosperity. Rather, these derive from domestic productivity levels in the making of goods and services that are, in their turn, driven by investment. To trade effectively, the key is to have something worth selling in the first place. Tariffs, regulation, barriers Unfortunately, the protectionist measures that had hastened the advent of World War II, and that were dismantled subsequently through the establishment of the GATT/WTO, led instead to a growing proliferation of non-tariff or technical barriers to trade. Rather than invest in new industries, older ones were sustained artificially behind a chaff of regulatory standards, intellectual property laws, state subsidies and public procurement policies. Accordingly, assertions that we have been living through a time marked by a so-called “rules-based international trading system” fall very wide of the mark. All the evidence points to systematic attempts by the key players – and the United States in particular – to subvert any supposed “liberal world order”, both economically and militarily. Now it may be, of course, that President Trump – who is certainly not the first US, or other, world leader to engage in such embargoes against China – understands full well that to compete internationally as a successful exporter it is the ability to produce efficiently at home that matters more than trade deals. Some of his pronouncements have reflected as much, looking to put pressure on manufacturers, such as Harley-Davidson and Nike, to bring their production back to its origins. But, irrespective, the adverse effects of this approach are evident for all to see. Many American firms have warned the US Department of Commerce that such measures hurt both businesses and consumers alike. The latter invariably bear the brunt of any related price increases. The IMF has cut its world economic growth forecast in accordance. And anyway, many enterprises will simply relocate elsewhere, such as to Vietnam, which is not currently on the receiving end of such additional duties. A risky game The deeper consequences, though, will take more time to become manifest. These include growing differences among the Western powers over how to handle the economic rise of the East. This was seen recently, through the US stance towards its partners not using the Chinese firm Huawei to develop critical 5G infrastructure, despite its being the leading global player in the field. Such actions could come to damage relations with key allies, such as the UK and Germany. In this regard, the US is playing a very risky game. With its relations veering towards a potential conflict with Iran, as well as its ongoing disputes with Russia and China, the US may yet come to rue antagonising its friends as well. Or, at the very least, it may regret making them have to choose between their relations with the US and China. Only this week, the UK chancellor, Phillip Hammond launched the new Shanghai-London Stock Connect that looks set to deepen financial relations by facilitating investment between them. This, and China’s recent decision not to pursue WTO market economy status, may also point to a growing maturity on its part in relation to such matters. Certainly, its most successful strategy in the past was always to keep a low profile on the international stage and avoid confrontation in foreign affairs, while focusing more on its domestic concerns. Historically, it has often been extraneous circumstances that have accelerated change in world affairs more than any conscious push. The two powers that dominated each of the last two preceding centuries – the US and UK – did so as much through the decline and imperial overreach of their predecessors as through their own efforts. That, and its underlying crisis of innovation and investment, are what the US leadership would do well to reflect upon most in Osaka. (Bill Durodie is Professor and Chair of International Relations, University of Bath) (This article was originally published on The Conversation. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

US-China trade war points to the real crisis that global leaders must confront at G20 Summit

By Allen Morrison and Stewart Black 
 
When US President Donald Trump meets Chinese leader Xi Jinping at the G-20 economic summit in Japan, hopes aren’t all that high that they will conclude with a comprehensive trade deal.

Nonetheless, most US business leaders and investors are optimistic that the two countries will eventually reach a trade agreement – and when they do, it will pry open Chinese markets and create a wealth of opportunities for US companies.

Specifically, American negotiators are pushing for a deal that could end forced technology transfers, improve intellectual property protection and widen access to China’s markets – all with the ultimate goal of creating a “level playing field” for US businesses.

Yet as beneficial as resolving intellectual property and technology transfer issues with China maybe – not to mention ending the trade war – this is not the biggest reason American companies have failed to do business in China. Rather, as our forthcoming research shows, their biggest failure stems from their inability to penetrate the country’s complex business ecosystems.

Changes to intellectual property regulations and tariff provisions will not magically fix this.

Doing business in China

Since the 1970s, foreign companies, including US businesses, have poured trillions of dollars into China to build global supply chains and access their markets.

In 2018, total foreign direct investment stocks in China reached a record $2.76 trillion, up from just over $915 billion a decade earlier.

For some Western companies as diverse as Coca-Cola, General Motors, Apple, Lego and L'Oréal, China has been a boon and remains a focus of their international expansion plans. After decades of commitment, they have made significant progress in China by emphasizing adaptability, delegation of decision-making, cultural learning, and talent acquisition and development.

But research we’re planning to publish later this summer shows that China remains an enigma for most U.S. businesses. Only 41 companies in the Standard &amp; Poor’s 500 stock index generate 10 per cent or more of their global revenues from China. Of the 30 largest companies in the index, only four have revenues that exceed 10 per cent of their global revenues.

And a 2017 Goldman Sachs analysis found that in all, S&amp;P 500 companies earned just 1 per cent of their revenues in China, compared with 30 per cent in total non-US sales.

Rise of the Chinese ‘megafirm’ 
 
No doubt Chinese government regulations, tariffs and the theft of intellectual property are among the significant barriers that have made it harder for US&nbsp;and other Western companies to do business in China. But we found that the biggest challenge is their failure to penetrate state-dominated business ecosystems built around what are essentially Chinese “megafirms.”

China’s largest conglomerates, which have grown an average of 20 per cent&nbsp;per year over the past decade have much in common with their Asian cousins. Like the chaebol of South Korea and keiretsu in Japan, affiliates and subsidiaries of Chinese megafirms are typically part of a network of cross-owned businesses. Ownership structures are difficult for outsiders to penetrate and act as nearly insurmountable barriers to entry for foreign companies.

But Chinese megafirms have a unique aspect to their structure and ownership: the role of the state, which includes national, provincial or municipal entities. Rather than serve as background context for decision-making within Chinese megafirms acting strictly as a regulator, the state is itself an owner and plays a much greater role than most Americans know.

The 10 biggest Chinese companies by revenue are all either state-owned or owned by a mixture of publicly listed investors and Chinese government entities. Of the 111 Chinese businesses on the Fortune Global 500 list in 2018, state-owned entities represented nearly 71%.

The rest were privately owned – many with publicly listed shares – but don’t let that fool you. With only a few exceptions, publicly listed companies in China are invariably partly owned by other companies in which operate in their ecosystem and these, in turn, are owned or partly owned by either the state or government-controlled entities.

Given the dearth of publicly accessible information and exacerbated by the maze of cross-ownerships, following the equity trail and fully understanding ownership is difficult in China and most often futile.

Success for foreign companies in China is invariably dependent on fitting into a major business ecosystem. These include networks of suppliers, assemblers, financial institutions, distributors, retailers and trading companies. At the center of this circle are typically one or several megafirms.

Unfortunately, the US businesses that can’t make it to the inside of that circle – the vast majority – are unable to prosper in China. And the Chinese government helps to pick who gets in, and who doesn’t.

Megafirms meet megabanks 
 
The Chinese government does not need to own a controlling share in order to exert powerful influence.

It can cause its companies to enter into new partnerships, diversify into new product lines, set up new production facilities, or expand distribution merely by signaling the desired outcomes through public or private statements, “introductions” to targeted partners and promises of new customers and revenue streams.

The government also uses Chinese “megabanks” to drive economic growth according to national priorities. In 2018, nearly 65 per cent of all bank loans in China were to corporate entities, twice as high as in the U.S. Megafirms are provided funding at preferential rates, leaving those on the outside at a disadvantage.

The banking sector in China is huge, with total assets of about $35 trillion in 2018, more than three times the country’s entire GDP. This circular financing feeds corporate growth and creates a circular system of codependency.

Because foreign companies are outside the system, they are at inherent disadvantage when it comes to attaining local loans from Chinese banks.

That creates another problem for Western companies. Most of them invest overseas with the goal of repatriating profits back home. China makes this very difficult. Which means they typically have to bring money in from their home countries – but because of Chinese tax rules and strict foreign exchange controls, they also have difficulty getting their investments back out.

Impenetrable China

A positive resolution to the trade war – either during the G-20 or sometime later – would be welcomed by many. But we believe that whatever agreements are reached on tariffs or intellectual property, these structural issues will persist.

The US&nbsp;and other outside companies that want to do business in China face a dilemma: Do they reinvent themselves in an effort to become insiders in China? Doing so would not only require a change in mentality, but also a commitment to being “in China, for China.”

Otherwise, China’s business ecosystem, with its megafirms and layers of affiliates with the government at the center of it all, will remain largely impenetrable for Western companies. Irrespective of what happens at the G-20, China is very unlikely to change a system that has created massive wealth and prosperity for the Chinese people. 
&nbsp;

(Allen Morrison is Professor of Global Management, Arizona State University; Stewart Black is Professor of Management Practice in Global Leadership and Strategy, INSEAD)

(This article was originally published on The Conversation. Read the original article)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)&nbsp; 
&nbsp;

By Allen Morrison and Stewart Black When US President Donald Trump meets Chinese leader Xi Jinping at the G-20 economic summit in Japan, hopes aren’t all that high that they will conclude with a comprehensive trade deal.

By Allen Morrison and Stewart Black When US President Donald Trump meets Chinese leader Xi Jinping at the G-20 economic summit in Japan, hopes aren’t all that high that they will conclude with a comprehensive trade deal. Nonetheless, most US business leaders and investors are optimistic that the two countries will eventually reach a trade agreement – and when they do, it will pry open Chinese markets and create a wealth of opportunities for US companies. Specifically, American negotiators are pushing for a deal that could end forced technology transfers, improve intellectual property protection and widen access to China’s markets – all with the ultimate goal of creating a “level playing field” for US businesses. Yet as beneficial as resolving intellectual property and technology transfer issues with China maybe – not to mention ending the trade war – this is not the biggest reason American companies have failed to do business in China. Rather, as our forthcoming research shows, their biggest failure stems from their inability to penetrate the country’s complex business ecosystems. Changes to intellectual property regulations and tariff provisions will not magically fix this. Doing business in China Since the 1970s, foreign companies, including US businesses, have poured trillions of dollars into China to build global supply chains and access their markets. In 2018, total foreign direct investment stocks in China reached a record $2.76 trillion, up from just over $915 billion a decade earlier. For some Western companies as diverse as Coca-Cola, General Motors, Apple, Lego and L'Oréal, China has been a boon and remains a focus of their international expansion plans. After decades of commitment, they have made significant progress in China by emphasizing adaptability, delegation of decision-making, cultural learning, and talent acquisition and development. But research we’re planning to publish later this summer shows that China remains an enigma for most U.S. businesses. Only 41 companies in the Standard & Poor’s 500 stock index generate 10 per cent or more of their global revenues from China. Of the 30 largest companies in the index, only four have revenues that exceed 10 per cent of their global revenues. And a 2017 Goldman Sachs analysis found that in all, S&P 500 companies earned just 1 per cent of their revenues in China, compared with 30 per cent in total non-US sales. Rise of the Chinese ‘megafirm’ No doubt Chinese government regulations, tariffs and the theft of intellectual property are among the significant barriers that have made it harder for US and other Western companies to do business in China. But we found that the biggest challenge is their failure to penetrate state-dominated business ecosystems built around what are essentially Chinese “megafirms.” China’s largest conglomerates, which have grown an average of 20 per cent per year over the past decade have much in common with their Asian cousins. Like the chaebol of South Korea and keiretsu in Japan, affiliates and subsidiaries of Chinese megafirms are typically part of a network of cross-owned businesses. Ownership structures are difficult for outsiders to penetrate and act as nearly insurmountable barriers to entry for foreign companies. But Chinese megafirms have a unique aspect to their structure and ownership: the role of the state, which includes national, provincial or municipal entities. Rather than serve as background context for decision-making within Chinese megafirms acting strictly as a regulator, the state is itself an owner and plays a much greater role than most Americans know. The 10 biggest Chinese companies by revenue are all either state-owned or owned by a mixture of publicly listed investors and Chinese government entities. Of the 111 Chinese businesses on the Fortune Global 500 list in 2018, state-owned entities represented nearly 71%. The rest were privately owned – many with publicly listed shares – but don’t let that fool you. With only a few exceptions, publicly listed companies in China are invariably partly owned by other companies in which operate in their ecosystem and these, in turn, are owned or partly owned by either the state or government-controlled entities. Given the dearth of publicly accessible information and exacerbated by the maze of cross-ownerships, following the equity trail and fully understanding ownership is difficult in China and most often futile. Success for foreign companies in China is invariably dependent on fitting into a major business ecosystem. These include networks of suppliers, assemblers, financial institutions, distributors, retailers and trading companies. At the center of this circle are typically one or several megafirms. Unfortunately, the US businesses that can’t make it to the inside of that circle – the vast majority – are unable to prosper in China. And the Chinese government helps to pick who gets in, and who doesn’t. Megafirms meet megabanks The Chinese government does not need to own a controlling share in order to exert powerful influence. It can cause its companies to enter into new partnerships, diversify into new product lines, set up new production facilities, or expand distribution merely by signaling the desired outcomes through public or private statements, “introductions” to targeted partners and promises of new customers and revenue streams. The government also uses Chinese “megabanks” to drive economic growth according to national priorities. In 2018, nearly 65 per cent of all bank loans in China were to corporate entities, twice as high as in the U.S. Megafirms are provided funding at preferential rates, leaving those on the outside at a disadvantage. The banking sector in China is huge, with total assets of about $35 trillion in 2018, more than three times the country’s entire GDP. This circular financing feeds corporate growth and creates a circular system of codependency. Because foreign companies are outside the system, they are at inherent disadvantage when it comes to attaining local loans from Chinese banks. That creates another problem for Western companies. Most of them invest overseas with the goal of repatriating profits back home. China makes this very difficult. Which means they typically have to bring money in from their home countries – but because of Chinese tax rules and strict foreign exchange controls, they also have difficulty getting their investments back out. Impenetrable China A positive resolution to the trade war – either during the G-20 or sometime later – would be welcomed by many. But we believe that whatever agreements are reached on tariffs or intellectual property, these structural issues will persist. The US and other outside companies that want to do business in China face a dilemma: Do they reinvent themselves in an effort to become insiders in China? Doing so would not only require a change in mentality, but also a commitment to being “in China, for China.” Otherwise, China’s business ecosystem, with its megafirms and layers of affiliates with the government at the center of it all, will remain largely impenetrable for Western companies. Irrespective of what happens at the G-20, China is very unlikely to change a system that has created massive wealth and prosperity for the Chinese people. (Allen Morrison is Professor of Global Management, Arizona State University; Stewart Black is Professor of Management Practice in Global Leadership and Strategy, INSEAD) (This article was originally published on The Conversation. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

A Trump-Xi trade deal would do little to fix the real problems US companies face in China

Pressured by a labour crunch and rising wages in China, Shu Ke' an, whose company supplies bulletproof vests, rifle bags and other tactical gear to the United States, first considered shifting some production to Southeast Asia a few years ago, but nothing came of it.

When <a href="https://www.wionews.com/world/asian-markets-tumble-over-intensifying-us-china-trade-tensions-223751">trade tensions</a> flared into a tariff war last year, however, it was the final straw.

A day after <a href="https://www.wionews.com/world/us-china-rekindle-trade-talks-ahead-of-donald-trump-xi-jinping-g20-meeting-228545">US President Donald</a> imposed additional tariffs on $200 billion of Chinese goods in September, Shu, 49, decided to start making vests for his US clients in Myanmar instead.

Since then, the Trump administration has further hiked tariffs on Chinese imports, raising the US taxes on Shu's Guangzhou-made bulletproof vests to 42.6%.

With more than half of his company's income reliant on orders from the United States, Shu was happy with his Myanmar decision.

"The trade war was actually a blessing in disguise," he said.

With Trump poised to slap 25% tariffs on another $300 billion-plus of Chinese goods, no exporter in China will be unscathed.

In recent years, some Chinese manufacturers had already started to relocate some of their capacity to countries such as Vietnam and Cambodia, due to high operating costs at home. The trade war is now pushing more to follow suit, especially makers of low-tech and low-value goods.

A few Chinese exporters have also tried to dodge the trade war bullet by quietly transhipping via third countries.

Choice Destination

Nine months on, Shu's firm, Yakeda Tactical Gear Co, is relying on his new Myanmar factory, which started operations in December, to produce new orders for its US clients.

The 220 workers at his original Guangzhou plant, in China's Pearl River Delta manufacturing powerhouse, now mostly supply clients in the Middle East, Africa and Europe.

In Yangon, meanwhile, Shu's Myanmar factory turns raw materials imported from China into backpacks, kit bags and pouches for rifles and pistols - all labelled 'Made in Myanmar' almost all of which are exported to the United States.

"Our factory is receiving many orders. The products are being exported to the US and Europe. So, I believe our future will be improved from working in this factory," said Marlar Cho, 36, a supervisor at the factory.

The factory manager, 40-year-old Jiang Aoxiong from eastern China, said they were constantly rushing to keep up with orders, despite its 600-strong workforce.

Though international criticism of Myanmar's handling of the Rohingya crisis has crimped Western investment, the Southeast Asian nation has become the choice destination for some Chinese firms, drawn to its cheap and abundant labour.

The former British colony, located on China's southwestern border, exports some 5,000 products to the United States duty-free under a US trade programme for developing nations - another big plus.

In the 12 months through April, approved Chinese projects increased by $585 million, the latest data from Myanmar's Directorate of Investment and Company Administration shows.

The infusion of Chinese capital has helped fuel expansion in Myanmar's fledgeling industrial sector.

In May, firms saw the fastest rise in workforce numbers since 2015, while production scaled a 13-month high, the latest Nikkei Myanmar Manufacturing Purchasing Managers' Index survey showed.

Stay or Go?

ACMEX Group, a tyre maker based in China's coastal Shandong province, already had some experience with offshoring when the trade war began.

About two years ago, it started manufacturing some tyres in Vietnam, Thailand and Malaysia to take advantage of lower labour and raw material costs and avoid US anti-dumping duties.

With fresh tariffs in the trade war, the company plans to boost the proportion of tyres made abroad to 50% from 20%, and build its own factories instead of outsourcing to existing factories, Chairman Guan Zheng said.

"The time is ripe now," he said, adding that supply chain infrastructure had improved.

The experience of companies like ACMEX and Shu's Yakeda Tactical Gear underlines how the trade war has put Chinese exporters on the back foot, needing to either diversify their client base, increase domestic sales or move production to a third country.

But all those options require time and money, which are not necessarily available to China's legion of small exporters grappling with thinning profit margins.

Even locations such as Vietnam and the Philippines have grown too dear for some.

While China has encouraged the relocation of some heavy industry overseas to ease overcapacity and support its ambitious Belt and Road infrastructure plan, Beijing is less supportive of a broader move to shift manufacturing offshore.

Liang Ming, director of the Institute of International Trade at the Ministry of Commerce's Chinese Academy of International Trade and Economic Cooperation, rejected the idea that Chinese firms were leaving China in droves.

"Few companies are actually moving. If they move, they risk losses if there is a China-US deal," Liang told reporters earlier this month, adding that any relocation back to China would be expensive.

As trade pressures intensify, analysts say China will loosen policy further in months ahead to shore up economic growth.

Investors are also watching to see how much Beijing allows the yuan to weaken to offset higher US tariffs. The tightly-managed currency has depreciated about 2% against the dollar since trade tensions worsened in early May.

Trump and Chinese President Xi Jinping are due to meet in Osaka at a G20 summit at the end of this week in a bid to reset ties poisoned by the trade war.

And though costs and labour may be cheaper, some Chinese firms with experience of offshoring say there are downsides too.

Factory manager Jiang complained about lower worker productivity in Myanmar compared with China, flooded roads during the rainy season, and power cuts of eight to nine hours every day.

"If there is no trade war between China and the US, we definitely would not have come to Myanmar to open our factory," he said.

Pressured by a labour crunch and rising wages in China, Shu Ke' an, whose company supplies bulletproof vests, rifle bags and other tactical gear to the United States, first considered shifting some production to Southeast Asia a few years ago, but nothing came of it.

Pressured by a labour crunch and rising wages in China, Shu Ke' an, whose company supplies bulletproof vests, rifle bags and other tactical gear to the United States, first considered shifting some production to Southeast Asia a few years ago, but nothing came of it. When trade tensions flared into a tariff war last year, however, it was the final straw. A day after US President Donald imposed additional tariffs on $200 billion of Chinese goods in September, Shu, 49, decided to start making vests for his US clients in Myanmar instead. Since then, the Trump administration has further hiked tariffs on Chinese imports, raising the US taxes on Shu's Guangzhou-made bulletproof vests to 42.6%. With more than half of his company's income reliant on orders from the United States, Shu was happy with his Myanmar decision. "The trade war was actually a blessing in disguise," he said. With Trump poised to slap 25% tariffs on another $300 billion-plus of Chinese goods, no exporter in China will be unscathed. In recent years, some Chinese manufacturers had already started to relocate some of their capacity to countries such as Vietnam and Cambodia, due to high operating costs at home. The trade war is now pushing more to follow suit, especially makers of low-tech and low-value goods. A few Chinese exporters have also tried to dodge the trade war bullet by quietly transhipping via third countries. Choice Destination Nine months on, Shu's firm, Yakeda Tactical Gear Co, is relying on his new Myanmar factory, which started operations in December, to produce new orders for its US clients. The 220 workers at his original Guangzhou plant, in China's Pearl River Delta manufacturing powerhouse, now mostly supply clients in the Middle East, Africa and Europe. In Yangon, meanwhile, Shu's Myanmar factory turns raw materials imported from China into backpacks, kit bags and pouches for rifles and pistols - all labelled 'Made in Myanmar' almost all of which are exported to the United States. "Our factory is receiving many orders. The products are being exported to the US and Europe. So, I believe our future will be improved from working in this factory," said Marlar Cho, 36, a supervisor at the factory. The factory manager, 40-year-old Jiang Aoxiong from eastern China, said they were constantly rushing to keep up with orders, despite its 600-strong workforce. Though international criticism of Myanmar's handling of the Rohingya crisis has crimped Western investment, the Southeast Asian nation has become the choice destination for some Chinese firms, drawn to its cheap and abundant labour. The former British colony, located on China's southwestern border, exports some 5,000 products to the United States duty-free under a US trade programme for developing nations - another big plus. In the 12 months through April, approved Chinese projects increased by $585 million, the latest data from Myanmar's Directorate of Investment and Company Administration shows. The infusion of Chinese capital has helped fuel expansion in Myanmar's fledgeling industrial sector. In May, firms saw the fastest rise in workforce numbers since 2015, while production scaled a 13-month high, the latest Nikkei Myanmar Manufacturing Purchasing Managers' Index survey showed. Stay or Go? ACMEX Group, a tyre maker based in China's coastal Shandong province, already had some experience with offshoring when the trade war began. About two years ago, it started manufacturing some tyres in Vietnam, Thailand and Malaysia to take advantage of lower labour and raw material costs and avoid US anti-dumping duties. With fresh tariffs in the trade war, the company plans to boost the proportion of tyres made abroad to 50% from 20%, and build its own factories instead of outsourcing to existing factories, Chairman Guan Zheng said. "The time is ripe now," he said, adding that supply chain infrastructure had improved. The experience of companies like ACMEX and Shu's Yakeda Tactical Gear underlines how the trade war has put Chinese exporters on the back foot, needing to either diversify their client base, increase domestic sales or move production to a third country. But all those options require time and money, which are not necessarily available to China's legion of small exporters grappling with thinning profit margins. Even locations such as Vietnam and the Philippines have grown too dear for some. While China has encouraged the relocation of some heavy industry overseas to ease overcapacity and support its ambitious Belt and Road infrastructure plan, Beijing is less supportive of a broader move to shift manufacturing offshore. Liang Ming, director of the Institute of International Trade at the Ministry of Commerce's Chinese Academy of International Trade and Economic Cooperation, rejected the idea that Chinese firms were leaving China in droves. "Few companies are actually moving. If they move, they risk losses if there is a China-US deal," Liang told reporters earlier this month, adding that any relocation back to China would be expensive. As trade pressures intensify, analysts say China will loosen policy further in months ahead to shore up economic growth. Investors are also watching to see how much Beijing allows the yuan to weaken to offset higher US tariffs. The tightly-managed currency has depreciated about 2% against the dollar since trade tensions worsened in early May. Trump and Chinese President Xi Jinping are due to meet in Osaka at a G20 summit at the end of this week in a bid to reset ties poisoned by the trade war. And though costs and labour may be cheaper, some Chinese firms with experience of offshoring say there are downsides too. Factory manager Jiang complained about lower worker productivity in Myanmar compared with China, flooded roads during the rainy season, and power cuts of eight to nine hours every day. "If there is no trade war between China and the US, we definitely would not have come to Myanmar to open our factory," he said.

To dodge trade war, Chinese exporters shift production to low-cost nations

Oil prices extended gains on Wednesday after rising in the previous session on rekindled hopes for a US-China trade deal and on the potential for conflict between the US and Iran in the Middle East after tanker attacks there last week.

Brent crude futures were up 3 cents at $62.17 a barrel by 0330 GMT. They rose 2% on Tuesday.

US West Texas Intermediate crude gained 12 cents to $54.02 a barrel. The US benchmark surged 3.8% in the last session.

In a post on Twitter, US President Donald Trump said preparations were starting for him to meet Chinese President Xi Jinping at the G20 summit in Osaka, Japan, next week.

That comes after talks to reach a broad deal on trade between the United States and China broke down last month after Washington accused the Chinese of backing away from previously agreed commitments.

Interaction between the two sides since then has been limited, and Trump has threatened, repeatedly, to slap more tariffs on Chinese products in an escalation that businesses in both countries want to avoid.

"Global demand for crude got a boost on expectations that trade talks are showing some positive signs following President Trump's tweets," said Edward Moya, senior market analyst at OANDA in New York.

Both oil benchmarks gave up earlier gains in the Asian session after data showed that Japan's exports fell for a sixth straight month in May as China-bound shipments weakened, underlining the impact of the trade war.

Tensions in the Middle East after last week's tanker attacks remain high, with Trump saying he was prepared to take military action to stop Iran having a nuclear bomb but leaving open whether he would sanction the use of force to protect Gulf oil supplies.

Fears of a confrontation between Iran and the United States have mounted since last Thursday's attacks, which Washington has blamed on Tehran. Iran has denied involvement.

Iran said this week it would breach internationally agreed curbs on its stock of low-enriched uranium within 10 days, possibly paving the way for the country to develop a nuclear weapon, adding that European nations still had time to save a landmark nuclear deal.

The US is deploying about 1,000 more troops to the Middle East for what Washington said were defensive purposes, citing concerns about a threat from Iran.

Market participants are also waiting for a meeting between the Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia, a group known as OPEC+, to decide whether to extend a supply reduction pact that ends this month.

OPEC and non-OPEC states are discussing holding meetings on July 10-12 in Vienna, a date range proposed by Iran, OPEC sources said on Tuesday. OPEC itself, however, is considering meeting on July 1-2 though it is still saying meeting will be held on June 25-26 on its website.

US crude stocks also fell by 812,000 barrels last week to 482 million, industry group the American Petroleum Institute said on Tuesday.

The report from the government's Energy Information Administration are due later on Wednesday.

Oil prices extended gains on Wednesday after rising in the previous session on rekindled hopes for a US-China trade deal and on the potential for conflict between the US and Iran in the Middle East after tanker attacks there last week.

Oil prices extended gains on Wednesday after rising in the previous session on rekindled hopes for a US-China trade deal and on the potential for conflict between the US and Iran in the Middle East after tanker attacks there last week. Brent crude futures were up 3 cents at $62.17 a barrel by 0330 GMT. They rose 2% on Tuesday. US West Texas Intermediate crude gained 12 cents to $54.02 a barrel. The US benchmark surged 3.8% in the last session. In a post on Twitter, US President Donald Trump said preparations were starting for him to meet Chinese President Xi Jinping at the G20 summit in Osaka, Japan, next week. That comes after talks to reach a broad deal on trade between the United States and China broke down last month after Washington accused the Chinese of backing away from previously agreed commitments. Interaction between the two sides since then has been limited, and Trump has threatened, repeatedly, to slap more tariffs on Chinese products in an escalation that businesses in both countries want to avoid. "Global demand for crude got a boost on expectations that trade talks are showing some positive signs following President Trump's tweets," said Edward Moya, senior market analyst at OANDA in New York. Both oil benchmarks gave up earlier gains in the Asian session after data showed that Japan's exports fell for a sixth straight month in May as China-bound shipments weakened, underlining the impact of the trade war. Tensions in the Middle East after last week's tanker attacks remain high, with Trump saying he was prepared to take military action to stop Iran having a nuclear bomb but leaving open whether he would sanction the use of force to protect Gulf oil supplies. Fears of a confrontation between Iran and the United States have mounted since last Thursday's attacks, which Washington has blamed on Tehran. Iran has denied involvement. Iran said this week it would breach internationally agreed curbs on its stock of low-enriched uranium within 10 days, possibly paving the way for the country to develop a nuclear weapon, adding that European nations still had time to save a landmark nuclear deal. The US is deploying about 1,000 more troops to the Middle East for what Washington said were defensive purposes, citing concerns about a threat from Iran. Market participants are also waiting for a meeting between the Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia, a group known as OPEC+, to decide whether to extend a supply reduction pact that ends this month. OPEC and non-OPEC states are discussing holding meetings on July 10-12 in Vienna, a date range proposed by Iran, OPEC sources said on Tuesday. OPEC itself, however, is considering meeting on July 1-2 though it is still saying meeting will be held on June 25-26 on its website. US crude stocks also fell by 812,000 barrels last week to 482 million, industry group the American Petroleum Institute said on Tuesday. The report from the government's Energy Information Administration are due later on Wednesday.

Oil gains amid Middle East tensions, US-China trade deal hopes

China's central bank chief said Friday the country has <a href="https://www.wionews.com/world/explainer-us-china-trade-war-the-levers-they-can-pull-224809">plenty of policy tools left to handle the trade war</a> with the United States.

There is "tremendous" room to counter the deepening trade war, People's Bank of China governor Yi Gang said in an interview with Bloomberg TV.

"We have plenty of room in interest rates, we have plenty of room in required reserve ratio rate, and also for the fiscal, monetary policy toolkit, I think the room for adjustment is tremendous," Yi said on Bloomberg TV.

<a href="https://www.wionews.com/world/china-warns-its-companies-on-us-travel-rebuffs-trade-criticism-224200">Ties between China and the US</a> have deteriorated sharply after trade negotiations stalled last month without a deal to lift bruising tariffs on goods worth $360 billion in two-way trade.

China said Thursday that it would soon release detailed information about a planned blacklist of "unreliable" foreign companies and individuals, that analysts expect will target firms cutting off supplies to <a href="https://www.wionews.com/world/amid-us-china-row-huawei-signs-deal-with-russian-telecom-company-mts-to-develop-5g-network-224867">Chinese tech giant Huawei</a>.

Last month the US Commerce Department placed Huawei and dozens of its affiliates on an "entity list" on grounds of national security, curbing its access to crucial US-made components and software -- through a 90-day reprieve was later issued.

Yi has participated in several rounds of the trade negotiations with Washington and is scheduled to meet with US Treasury Secretary Steven Mnuchin this weekend during the G20 gathering of financial policymakers in Japan.

He said the meeting with Mnuchin would be "productive talk, as always," but trade war discussions would be "uncertain and difficult", according to Bloomberg News.

Watch: IMF's Lagarde warns of 'growing concerns' over trade tensions

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China's yuan, or renminbi, the currency has also rapidly depreciated against the dollar as trade tensions have ramped up in recent weeks, nearing the critical seven to the dollar exchange rate.

The central bank has long prevented the yuan from falling below seven, but Yi hinted the bank may no longer defend the currency at that level.

"I don't think along this mathematical scale any number is more important (than) the other number," he said.

"The trade war would have a temporary depreciation pressure on the renminbi, but you see, after the noise, (the) renminbi will continue to be very stable and relatively strong compared to emerging market currencies, even compared to convertible currencies," he told Bloomberg TV.

"I'm very confident (the) renminbi will continue to be stable at a more or less equilibrium level," Yi said.

China's central bank chief said Friday the country has plenty of policy tools left to handle the trade war with the United States. There is "tremendous" room to counter the deepening trade war, People's Bank of China governor Yi Gang said in an interview with Bloomberg TV.

China's central bank chief said Friday the country has plenty of policy tools left to handle the trade war with the United States. There is "tremendous" room to counter the deepening trade war, People's Bank of China governor Yi Gang said in an interview with Bloomberg TV. "We have plenty of room in interest rates, we have plenty of room in required reserve ratio rate, and also for the fiscal, monetary policy toolkit, I think the room for adjustment is tremendous," Yi said on Bloomberg TV. Ties between China and the US have deteriorated sharply after trade negotiations stalled last month without a deal to lift bruising tariffs on goods worth $360 billion in two-way trade. China said Thursday that it would soon release detailed information about a planned blacklist of "unreliable" foreign companies and individuals, that analysts expect will target firms cutting off supplies to Chinese tech giant Huawei. Last month the US Commerce Department placed Huawei and dozens of its affiliates on an "entity list" on grounds of national security, curbing its access to crucial US-made components and software -- through a 90-day reprieve was later issued. Yi has participated in several rounds of the trade negotiations with Washington and is scheduled to meet with US Treasury Secretary Steven Mnuchin this weekend during the G20 gathering of financial policymakers in Japan. He said the meeting with Mnuchin would be "productive talk, as always," but trade war discussions would be "uncertain and difficult", according to Bloomberg News. Watch: IMF's Lagarde warns of 'growing concerns' over trade tensions × China's yuan, or renminbi, the currency has also rapidly depreciated against the dollar as trade tensions have ramped up in recent weeks, nearing the critical seven to the dollar exchange rate. The central bank has long prevented the yuan from falling below seven, but Yi hinted the bank may no longer defend the currency at that level. "I don't think along this mathematical scale any number is more important (than) the other number," he said. "The trade war would have a temporary depreciation pressure on the renminbi, but you see, after the noise, (the) renminbi will continue to be very stable and relatively strong compared to emerging market currencies, even compared to convertible currencies," he told Bloomberg TV. "I'm very confident (the) renminbi will continue to be stable at a more or less equilibrium level," Yi said.

China has tools to handle trade war with US: Central bank chief Yi Gang

China's top diplomat Wang Yi has asked US Secretary of State Mike Pompeo not to go "too far" in its "damaging moves" against the Chinese interests, saying that <a href="https://www.wionews.com/world/chinas-tough-rhetoric-leaves-trade-talks-with-us-in-limbo-219517">both countries will benefit from cooperation and lose from conflicts</a>.

State Councillor and Foreign Minister Wang held a telephonic conversation with Pompeo on Saturday, days after US President Donald Trump signed an executive order barring American companies from installing the foreign-made telecom equipment posing a national security threat, a move apparently aimed at banning Huawei from US networks.

Beijing has warned of retaliation against the order that effectively barred Chinese telecom giant Huawei from the US market.

The world's top two economies are locked in a trade battle that has seen mounting tariffs, sparking fears that the conflict could damage the global economy.

Wang, noting that the US has recently made remarks and taken actions that are harmful to the Chinese interests in various fields including cracking down on Chinese enterprises' normal operations through political measures, said China strongly opposes such actions.

<iframe allowfullscreen="" autoplay="1" class="includeVideo" frameborder="0" height="350" src="https://www.wionews.com/videos/us-president-donald-trump-vows-to-strike-trade-deal-with-china-218837/embed" style="width:100%;max-width:560px;" width="560"></iframe>

"We urge the US side not to go too far," he told Pompeo.

History and reality have shown that as two big countries, China and the US will both benefit from cooperation and lose from conflicts, Wang said, adding that cooperation is the only right choice for the two countries.

The two sides should follow the direction set by the two countries' heads of state, manage their differences on the basis of mutual respect, expand cooperation on the basis of mutual benefit, and work together in pushing forward a China-US relationship based on coordination, cooperation and stability, state-run Xinhua news agency quoted Wang as saying.

China has always been willing to resolve economic and trade differences through negotiations and consultations, which, however, should be conducted on the basis of equality, he said, adding that China, in any negotiations, must safeguard its legitimate interests, answer the calls of its people, and defend the basic norms of international relations.

Wang stressed that China has stated its firm opposition to the US' recent negative words and acts related to Taiwan, and urged Washington to abide by the 'one-China principle' and the three China-US joint communiques, and handle Taiwan-related issues carefully and properly.

The two sides also exchanged views on relevant international and regional&nbsp; 
issues, the report said.

Wang emphasized that China, as a permanent member of the UN Security Council, is committed to the de-nuclearisation, peace and stability of the Middle East.

The trade war between China and the US escalated after Trump this month increased the import duty on Chinese products worth $200 billion from 10 per cent to 25 per cent. China retaliated by slapping tariffs on $60 billion worth of US imports.

Trump has been demanding that China reduce the massive trade deficit which last year climbed to over $539 billion. He is also pressing for verifiable measures for protection of intellectual property rights (IPR), technology transfer and more access to American goods to Chinese markets.

China's top diplomat Wang Yi has asked US Secretary of State Mike Pompeo not to go "too far" in its "damaging moves" against the Chinese interests, saying that both countries will benefit from cooperation and lose from conflicts.

China's top diplomat Wang Yi has asked US Secretary of State Mike Pompeo not to go "too far" in its "damaging moves" against the Chinese interests, saying that both countries will benefit from cooperation and lose from conflicts. State Councillor and Foreign Minister Wang held a telephonic conversation with Pompeo on Saturday, days after US President Donald Trump signed an executive order barring American companies from installing the foreign-made telecom equipment posing a national security threat, a move apparently aimed at banning Huawei from US networks. Beijing has warned of retaliation against the order that effectively barred Chinese telecom giant Huawei from the US market. The world's top two economies are locked in a trade battle that has seen mounting tariffs, sparking fears that the conflict could damage the global economy. Wang, noting that the US has recently made remarks and taken actions that are harmful to the Chinese interests in various fields including cracking down on Chinese enterprises' normal operations through political measures, said China strongly opposes such actions. "We urge the US side not to go too far," he told Pompeo. History and reality have shown that as two big countries, China and the US will both benefit from cooperation and lose from conflicts, Wang said, adding that cooperation is the only right choice for the two countries. The two sides should follow the direction set by the two countries' heads of state, manage their differences on the basis of mutual respect, expand cooperation on the basis of mutual benefit, and work together in pushing forward a China-US relationship based on coordination, cooperation and stability, state-run Xinhua news agency quoted Wang as saying. China has always been willing to resolve economic and trade differences through negotiations and consultations, which, however, should be conducted on the basis of equality, he said, adding that China, in any negotiations, must safeguard its legitimate interests, answer the calls of its people, and defend the basic norms of international relations. Wang stressed that China has stated its firm opposition to the US' recent negative words and acts related to Taiwan, and urged Washington to abide by the 'one-China principle' and the three China-US joint communiques, and handle Taiwan-related issues carefully and properly. The two sides also exchanged views on relevant international and regional issues, the report said. Wang emphasized that China, as a permanent member of the UN Security Council, is committed to the de-nuclearisation, peace and stability of the Middle East. The trade war between China and the US escalated after Trump this month increased the import duty on Chinese products worth $200 billion from 10 per cent to 25 per cent. China retaliated by slapping tariffs on $60 billion worth of US imports. Trump has been demanding that China reduce the massive trade deficit which last year climbed to over $539 billion. He is also pressing for verifiable measures for protection of intellectual property rights (IPR), technology transfer and more access to American goods to Chinese markets.

Don't go 'too far' in 'damaging moves': China tells US

The rupee Tuesday recovered 7 paise to close at 70.44 to the US dollar on the back of gains in equity markets while US-China trade-related concerns and rising crude oil prices continued to weigh on investor sentiment.

Stock markets cut short their nine-day losing streak with the benchmark BSE Sensex closing 0.61 per cent higher and NSE Nifty regaining nearly 74 points on value buying in pharma and banking counters.

At the interbank foreign exchange market, the rupee opened strong at 70.43 against the US currency. During the day, the local unit moved in a range of 70.51 to 70.30.

The domestic currency finally ended at 70.44, up 7 paise against its previous close. The rupee had slid to a two-and-a-half-month-low of 70.51 Monday on heavy forex outflows.

"Strong recovery in the domestic equity markets and US Futures helped the rupee maintain strength throughout the session," said V K Sharma, Head PCG &amp; Capital Markets Strategy, HDFC Securities.

Foreign fund outflows, rising crude prices and US-China trade-related concerns continued to weigh on the domestic currency, dealers said.

"Rupee has nearly depreciated by 1.4 per cent in the last one week on account of the escalating trade dispute between US and China and sustained outflow from the Indian capital market. There has been a net outflow of around $200 million dollars from the Indian capital market in the last one week," said Vaqarjaved Khan (Research Analyst, Angel Broking).

On the trade war front, US President Donald Trump remained adamant on his policy to impose a hefty import duty on Chinese products, which has resulted in a quick retaliation from China and a massive fall in the American stock markets fearing a US-China trade war.

"There can be some retaliation, but it can't be very, very substantial, by comparison," Trump told reporters at the Oval Office of the White House. 
China announced a hike in retaliatory tariffs on the import of $60 billion of American products.

Meanwhile, the Dollar Index which gauges the greenback's strength against a basket of six currencies gained 0.06 per cent to 97.38.

Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 2,011.85 crore on a net basis Tuesday, provisional exchange data showed.

Brent crude futures, the global oil benchmark, rose 1.28 per cent to trade at USD 71.13 per barrel amid simmering US-Iran tensions and supply-side disruptions.

Meanwhile, Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 70.2576 and for rupee/euro at 78.9227. The reference rate for rupee/British pound was fixed at 91.4370 and for rupee/100 Japanese yen at 64.04.&nbsp;

The rupee Tuesday recovered 7 paise to close at 70.44 to the US dollar on the back of gains in equity markets while US-China trade-related concerns and rising crude oil prices continued to weigh on investor sentiment.

The rupee Tuesday recovered 7 paise to close at 70.44 to the US dollar on the back of gains in equity markets while US-China trade-related concerns and rising crude oil prices continued to weigh on investor sentiment. Stock markets cut short their nine-day losing streak with the benchmark BSE Sensex closing 0.61 per cent higher and NSE Nifty regaining nearly 74 points on value buying in pharma and banking counters. At the interbank foreign exchange market, the rupee opened strong at 70.43 against the US currency. During the day, the local unit moved in a range of 70.51 to 70.30. The domestic currency finally ended at 70.44, up 7 paise against its previous close. The rupee had slid to a two-and-a-half-month-low of 70.51 Monday on heavy forex outflows. "Strong recovery in the domestic equity markets and US Futures helped the rupee maintain strength throughout the session," said V K Sharma, Head PCG & Capital Markets Strategy, HDFC Securities. Foreign fund outflows, rising crude prices and US-China trade-related concerns continued to weigh on the domestic currency, dealers said. "Rupee has nearly depreciated by 1.4 per cent in the last one week on account of the escalating trade dispute between US and China and sustained outflow from the Indian capital market. There has been a net outflow of around $200 million dollars from the Indian capital market in the last one week," said Vaqarjaved Khan (Research Analyst, Angel Broking). On the trade war front, US President Donald Trump remained adamant on his policy to impose a hefty import duty on Chinese products, which has resulted in a quick retaliation from China and a massive fall in the American stock markets fearing a US-China trade war. "There can be some retaliation, but it can't be very, very substantial, by comparison," Trump told reporters at the Oval Office of the White House. China announced a hike in retaliatory tariffs on the import of $60 billion of American products. Meanwhile, the Dollar Index which gauges the greenback's strength against a basket of six currencies gained 0.06 per cent to 97.38. Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 2,011.85 crore on a net basis Tuesday, provisional exchange data showed. Brent crude futures, the global oil benchmark, rose 1.28 per cent to trade at USD 71.13 per barrel amid simmering US-Iran tensions and supply-side disruptions. Meanwhile, Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 70.2576 and for rupee/euro at 78.9227. The reference rate for rupee/British pound was fixed at 91.4370 and for rupee/100 Japanese yen at 64.04.

Rupee recovers 7 paise along with stocks, ends at 70.44 vs US dollar

Markets in Asia were largely down in morning trade on Monday as the lack of a <a href="https://www.wionews.com/business-economy/oil-rallies-on-hopes-for-us-china-trade-deal-217381">US-China trade deal </a>cast a cloud over the market.

Investors watched the latest developments warily in the trade war between the world's top two economies after negotiations in Washington ended Friday without agreement and a tariff hike on Chinese imports went into effect.

White House economic advisor Larry Kudlow said US President Donald Trump and China's Xi Jinping could meet next month on the sidelines of the G20 summit to hash out their differences on trade -- but no new talks are yet scheduled.

"Central banks this year have switched into this dovish pivot -- that's allowed the market to continue higher whatever the weather" up until recently, Eleanor Creagh, Australia market strategist at Saxo Capital Markets, told Bloomberg Television.&nbsp;

"With the breakdown of these trade negotiations, people will have to sit back and think how far this dovish central bank stance can really continue to carry us."

Trump had accused Beijing of reneging on its commitments in trade talks and ordered new punitive duties -- which took effect Friday -- on $200 billion worth of Chinese imports, raising them to 25 per cent from 10 per cent.&nbsp;

He then ordered a tariff hike on almost all remaining imports from China, which are worth about $300 billion, according to US Trade Representative Robert Lighthizer.

China's top trade negotiator, Vice Premier Liu He, had warned earlier that Beijing "must respond" to any US tariffs.&nbsp;

"US-China trade relations will continue centre stage this week with most other data and events relegated to a distant second place," said OANDA senior market analyst Jeffrey Halley.

"China will no doubt announce retaliatory measures while the US may provide more concrete start dates for the newly-imposed tariffs. Markets can expect short-term whipsaw price action as the street hangs on every little comment emanating from Washington DC and Beijing."

Tokyo was down 0.5 per cent, Shanghai lost one per cent, Singapore shed 1.2 per cent and Seoul slipped more than one per cent in morning trade.

S&amp;P 500 Index futures dropped as much as 1.2 percent and ten-year US yields are hovering near the lowest level since early April.

Amid nervousness in China markets, state funds reportedly intervened to prop up shares on Monday and again Friday, when the Shanghai Composite closed up more than 3 percent.

Traders will also be watching this week for earnings reports from China tech giants Tencent and Alibaba, and key data on China industrial production and retail sales slated for Wednesday -- the same day figures are due for US retail sales and industrial production.

Markets in Asia were largely down in morning trade on Monday as the lack of a US-China trade deal cast a cloud over the market. Investors watched the latest developments warily in the trade war between the world's top two economies after negotiations in Washington ended Friday without agreement and a tariff hike on Chinese imports went into effect.

Markets in Asia were largely down in morning trade on Monday as the lack of a US-China trade deal cast a cloud over the market. Investors watched the latest developments warily in the trade war between the world's top two economies after negotiations in Washington ended Friday without agreement and a tariff hike on Chinese imports went into effect. White House economic advisor Larry Kudlow said US President Donald Trump and China's Xi Jinping could meet next month on the sidelines of the G20 summit to hash out their differences on trade -- but no new talks are yet scheduled. "Central banks this year have switched into this dovish pivot -- that's allowed the market to continue higher whatever the weather" up until recently, Eleanor Creagh, Australia market strategist at Saxo Capital Markets, told Bloomberg Television. "With the breakdown of these trade negotiations, people will have to sit back and think how far this dovish central bank stance can really continue to carry us." Trump had accused Beijing of reneging on its commitments in trade talks and ordered new punitive duties -- which took effect Friday -- on $200 billion worth of Chinese imports, raising them to 25 per cent from 10 per cent. He then ordered a tariff hike on almost all remaining imports from China, which are worth about $300 billion, according to US Trade Representative Robert Lighthizer. China's top trade negotiator, Vice Premier Liu He, had warned earlier that Beijing "must respond" to any US tariffs. "US-China trade relations will continue centre stage this week with most other data and events relegated to a distant second place," said OANDA senior market analyst Jeffrey Halley. "China will no doubt announce retaliatory measures while the US may provide more concrete start dates for the newly-imposed tariffs. Markets can expect short-term whipsaw price action as the street hangs on every little comment emanating from Washington DC and Beijing." Tokyo was down 0.5 per cent, Shanghai lost one per cent, Singapore shed 1.2 per cent and Seoul slipped more than one per cent in morning trade. S&P 500 Index futures dropped as much as 1.2 percent and ten-year US yields are hovering near the lowest level since early April. Amid nervousness in China markets, state funds reportedly intervened to prop up shares on Monday and again Friday, when the Shanghai Composite closed up more than 3 percent. Traders will also be watching this week for earnings reports from China tech giants Tencent and Alibaba, and key data on China industrial production and retail sales slated for Wednesday -- the same day figures are due for US retail sales and industrial production.

Lack of US-China trade deal weighs on Asian markets

&nbsp;By Tony Walker 
 
The Chinese have a saying attributed to the philosopher and writer Lao Tzu: every journey begins with a single step.

If that is the case, US-China relations have taken a step backwards in negotiators’ failure to advance trade negotiations in the latest round of talks in Washington, which ended unsatisfactorily.

China has said it is willing to resume discussions. The US has sent mixed messages, including a series of bombastic tweets from President Donald Trump warning of a worse deal if an agreement is not reached before the next presidential election.

Washington responded to the inability of the two sides to bridge their differences by raising tariffs on $200 billion worth of Chinese imports to 25 per cent from 10 per cent already imposed.

The administration has threatened to extend tariff increases to virtually all Chinese imports. This would likely prompt a trade war.

Sharp differences remain over the wording of the trade agreement itself. Beijing regards the language as too harsh on intellectual property and trade secrets theft, forced technology transfers, competition policy, access to financial services, and currency manipulation.

China appears to have hardened its position on some of these issues in the course of the negotiations, after having earlier indicated more flexibility.

This does not augur well for an early resolution.

The US has also clearly resolved to increase pressure on China on other fronts, in what risks becoming deepening differences on a range of issues.

As trade negotiators convened in Washington two US warships sailed near disputed islands and island features claimed by China in the South China Sea. This is the third time this year the US has conducted freedom of navigation operations next to Chinese-claimed territory.

Coinciding with last week’s stalled trade talks, the US also barred the large Chinese telecommunications operator, China Mobile Ltd, from operating in the US. Washington cited security concerns.

This comes in the wake of the US decision to ban the Chinese telecommunication communications equipment supplier, Huawei, from participating in the buildout of its 5G network.

US pressure led to three other members of the so-called “five eyes” security partnership, including Australia, to bar Huawei as well. Britain, alone among the “five eyes”, has agreed to allow the Chinese company to participate in non-core aspects of the 5G buildout.

This will be viewed in Beijing as an indication the US is using its economic weight to confront China more broadly and encourage its allies to follow suit.

US attempts to extradite the daughter of the founder of Huawei from Canada to face charges for breaching sanctions against Iran risk further souring relations.

While it would be premature to describe a messy pause in US-China trade negotiations as an inflexion moment in an increasingly complex relationship, it is unarguable that US-China relations have entered a new and more fractious phase.

What is unclear is whether a more overtly competitive relationship is bringing closer the day when the gloves really do come off in a way that threatens global harmony.

In any case, it seems clear a period of relative amity, during which the US and China sought to achieve a reasonable balance between an old and a new global order, is over.

Benn Steil, director of the international economics program at the Council on Foreign Relations, told Bloomberg that rivalry between the US and China for control of everything from global trade routes to cyberspace will drive the relationship for years to come.

“The heady era of global integration is gone,” Steil said.

This view may prove alarmist, but, on latest indications, overcoming trade and other differences between Washington and Beijing will be easier said than done.

Trump’s arrival in the White House, with a team of trade advisers who have made careers railing against China’s uncompetitive trade practices, has brought trading differences more sharply into focus.

Disputes over intellectual property, market access, alleged currency manipulation and a host of other trade issues have been present ever since China began its inexorable rise.

US politicians of left and right agitate against what’s perceived to be China’s mercantilist trade policies. This is blamed for American jobs draining away from the country’s manufacturing heartland.

Prominent Democrats, including Senate minority leader Chuck Schumer, support Trump’s tough stand on China. Democratic presidential hopefuls like Bernie Sanders have accused Trump of not delivering on his promises to upend US trading relationships.

Trump’s unhelpful response to the failure in Washington to achieve breakthrough points to an uncertain conclusion to complex negotiations that would lay the foundation for a more stable relationship.

This contribution to the debate provides an indication of the extent to which US-China relations have become enmeshed in American domestic politics.

Trade frictions with China risk becoming more – not less – intense as a presidential election year approaches in 2020.

Presidential campaigns tend to expose sharper differences on trade as the two sides compete for votes in the American rust belt, where factory closures have killed off tens of thousands of jobs.

One of Trump’s boasts is that he has reversed this trend by encouraging American business to reinvest onshore and bring jobs home. But disruptions to trade have their costs.

Trump’s tariff war against China has hit American farmers hard as the Chinese have retaliated by seeking alternative markets for agricultural commodities such as soybeans.

In other words, China is not without an ability to strike back at US attempts to strong-arm it over trade.

In the end, a resolution of a damaging US-China trade dispute that risks broader damage to a global trading system will require the intervention of respective leaders, Trump and his Chinese counterpart, Xi Jinping. The two will meet in June at the Osaka G20 leaders’ summit.

What is complicating that scenario is that crude US attempts to ramp up pressure on Beijing may well prove counterproductive. In Chinese culture, the issue of “face” is important.

Xi will not want to lose “face” in negotiations with Trump by yielding ground unduly. As US academic Patrick Chovanec writes:

"If we want China to embrace structural reform that requires real commitment – it’s not something we can just twist their arm to do, they have to buy into it. When you basically strong-arm them into doing something they really don’t want to do, and they’re convinced it’s harmful to their interests, at some point they are going to cheat, push back, or scuttle it, it’s just a question of when, because they haven’t bought into it."

US-China trade negotiations risk-taking more than a few steps back. 
 
(Tony Walker is Adjunct Professor, School of Communications, La Trobe University)

(This article was originally published on The DNA. Read the <a href="https://theconversation.com/stakes-are-high-as-us-ups-the-ante-on-trade-dispute-with-china-116985">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)&nbsp;

 
 
 
 
 
&nbsp;

By Tony Walker The Chinese have a saying attributed to the philosopher and writer Lao Tzu: every journey begins with a single step. If that is the case, US-China relations have taken a step backwards in negotiators’ failure to advance trade negotiations in the latest round of talks in Washington, which ended unsatisfactorily.

By Tony Walker The Chinese have a saying attributed to the philosopher and writer Lao Tzu: every journey begins with a single step. If that is the case, US-China relations have taken a step backwards in negotiators’ failure to advance trade negotiations in the latest round of talks in Washington, which ended unsatisfactorily. China has said it is willing to resume discussions. The US has sent mixed messages, including a series of bombastic tweets from President Donald Trump warning of a worse deal if an agreement is not reached before the next presidential election. Washington responded to the inability of the two sides to bridge their differences by raising tariffs on $200 billion worth of Chinese imports to 25 per cent from 10 per cent already imposed. The administration has threatened to extend tariff increases to virtually all Chinese imports. This would likely prompt a trade war. Sharp differences remain over the wording of the trade agreement itself. Beijing regards the language as too harsh on intellectual property and trade secrets theft, forced technology transfers, competition policy, access to financial services, and currency manipulation. China appears to have hardened its position on some of these issues in the course of the negotiations, after having earlier indicated more flexibility. This does not augur well for an early resolution. The US has also clearly resolved to increase pressure on China on other fronts, in what risks becoming deepening differences on a range of issues. As trade negotiators convened in Washington two US warships sailed near disputed islands and island features claimed by China in the South China Sea. This is the third time this year the US has conducted freedom of navigation operations next to Chinese-claimed territory. Coinciding with last week’s stalled trade talks, the US also barred the large Chinese telecommunications operator, China Mobile Ltd, from operating in the US. Washington cited security concerns. This comes in the wake of the US decision to ban the Chinese telecommunication communications equipment supplier, Huawei, from participating in the buildout of its 5G network. US pressure led to three other members of the so-called “five eyes” security partnership, including Australia, to bar Huawei as well. Britain, alone among the “five eyes”, has agreed to allow the Chinese company to participate in non-core aspects of the 5G buildout. This will be viewed in Beijing as an indication the US is using its economic weight to confront China more broadly and encourage its allies to follow suit. US attempts to extradite the daughter of the founder of Huawei from Canada to face charges for breaching sanctions against Iran risk further souring relations. While it would be premature to describe a messy pause in US-China trade negotiations as an inflexion moment in an increasingly complex relationship, it is unarguable that US-China relations have entered a new and more fractious phase. What is unclear is whether a more overtly competitive relationship is bringing closer the day when the gloves really do come off in a way that threatens global harmony. In any case, it seems clear a period of relative amity, during which the US and China sought to achieve a reasonable balance between an old and a new global order, is over. Benn Steil, director of the international economics program at the Council on Foreign Relations, told Bloomberg that rivalry between the US and China for control of everything from global trade routes to cyberspace will drive the relationship for years to come. “The heady era of global integration is gone,” Steil said. This view may prove alarmist, but, on latest indications, overcoming trade and other differences between Washington and Beijing will be easier said than done. Trump’s arrival in the White House, with a team of trade advisers who have made careers railing against China’s uncompetitive trade practices, has brought trading differences more sharply into focus. Disputes over intellectual property, market access, alleged currency manipulation and a host of other trade issues have been present ever since China began its inexorable rise. US politicians of left and right agitate against what’s perceived to be China’s mercantilist trade policies. This is blamed for American jobs draining away from the country’s manufacturing heartland. Prominent Democrats, including Senate minority leader Chuck Schumer, support Trump’s tough stand on China. Democratic presidential hopefuls like Bernie Sanders have accused Trump of not delivering on his promises to upend US trading relationships. Trump’s unhelpful response to the failure in Washington to achieve breakthrough points to an uncertain conclusion to complex negotiations that would lay the foundation for a more stable relationship. This contribution to the debate provides an indication of the extent to which US-China relations have become enmeshed in American domestic politics. Trade frictions with China risk becoming more – not less – intense as a presidential election year approaches in 2020. Presidential campaigns tend to expose sharper differences on trade as the two sides compete for votes in the American rust belt, where factory closures have killed off tens of thousands of jobs. One of Trump’s boasts is that he has reversed this trend by encouraging American business to reinvest onshore and bring jobs home. But disruptions to trade have their costs. Trump’s tariff war against China has hit American farmers hard as the Chinese have retaliated by seeking alternative markets for agricultural commodities such as soybeans. In other words, China is not without an ability to strike back at US attempts to strong-arm it over trade. In the end, a resolution of a damaging US-China trade dispute that risks broader damage to a global trading system will require the intervention of respective leaders, Trump and his Chinese counterpart, Xi Jinping. The two will meet in June at the Osaka G20 leaders’ summit. What is complicating that scenario is that crude US attempts to ramp up pressure on Beijing may well prove counterproductive. In Chinese culture, the issue of “face” is important. Xi will not want to lose “face” in negotiations with Trump by yielding ground unduly. As US academic Patrick Chovanec writes: "If we want China to embrace structural reform that requires real commitment – it’s not something we can just twist their arm to do, they have to buy into it. When you basically strong-arm them into doing something they really don’t want to do, and they’re convinced it’s harmful to their interests, at some point they are going to cheat, push back, or scuttle it, it’s just a question of when, because they haven’t bought into it." US-China trade negotiations risk-taking more than a few steps back. (Tony Walker is Adjunct Professor, School of Communications, La Trobe University) (This article was originally published on The DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL.)

Stakes are high as US ups the ante on trade dispute with China

China's top trade negotiator Liu He said on Friday in Washington that<a href="https://www.wionews.com/world/us-officials-says-china-trade-talks-constructive-217600"> trade talks with the US</a> would continue in Beijing but warned that there would be no concessions on "important principles".

"Negotiations have not broken down, but rather on the contrary, this is only a normal twist in the negotiations between the two countries, it is inevitable," Liu told Chinese media.

<a href="https://www.wionews.com/photos/top-facts-how-us-china-talks-differ-from-any-other-trade-deal-217563">In pics: How US-China talks differ from any other trade deal</a>

"Both sides agree they will meet again in Beijing in the future and keep pushing forward the negotiations," he said without giving a date.

Although Liu deemed the two days of talks in the US "productive" he said differences continued to exist.

"We have a consensus in lots of areas but to speak frankly there are areas we have differences on, and we believe these concern big principles," he said.

"Every country has important principles, and we will not make concessions on matters of principle."

US Treasury Secretary Steven Mnuchin said earlier, talks to end a worrisome&nbsp;<a href="https://www.wionews.com/photos/top-facts-how-us-china-talks-differ-from-any-other-trade-deal-217563">US-China trade battle</a>&nbsp;were "constructive," giving a sign of hope that Washington and Beijing could seal a deal to avert damage to the global economy.

"They were constructive discussions between both parties, that's all we're going to say," Mnuchin was quoted as saying by CNBC following a two-hour negotiating session.

President Donald&nbsp;<a href="https://www.wionews.com/world/tariffs-will-bring-in-far-more-wealth-to-our-country-than-even-phenomenal-deal-of-traditional-kind-donald-trump-217507">Trump said Friday he was in no hurry to reach a deal with Beijing</a>, arguing the United States was negotiating from a position of strength.

Just hours earlier, Washington had pulled the trigger on an increase in punitive duties on $200 billion in Chinese imports to 25 per cent from 10 per cent, and Beijing responded vowing to take the "necessary countermeasures."

China's top trade negotiator Liu He said on Friday in Washington that trade talks with the US would continue in Beijing but warned that there would be no concessions on "important principles".

China's top trade negotiator Liu He said on Friday in Washington that trade talks with the US would continue in Beijing but warned that there would be no concessions on "important principles". "Negotiations have not broken down, but rather on the contrary, this is only a normal twist in the negotiations between the two countries, it is inevitable," Liu told Chinese media. In pics: How US-China talks differ from any other trade deal "Both sides agree they will meet again in Beijing in the future and keep pushing forward the negotiations," he said without giving a date. Although Liu deemed the two days of talks in the US "productive" he said differences continued to exist. "We have a consensus in lots of areas but to speak frankly there are areas we have differences on, and we believe these concern big principles," he said. "Every country has important principles, and we will not make concessions on matters of principle." US Treasury Secretary Steven Mnuchin said earlier, talks to end a worrisome US-China trade battle were "constructive," giving a sign of hope that Washington and Beijing could seal a deal to avert damage to the global economy. "They were constructive discussions between both parties, that's all we're going to say," Mnuchin was quoted as saying by CNBC following a two-hour negotiating session. President Donald Trump said Friday he was in no hurry to reach a deal with Beijing, arguing the United States was negotiating from a position of strength. Just hours earlier, Washington had pulled the trigger on an increase in punitive duties on $200 billion in Chinese imports to 25 per cent from 10 per cent, and Beijing responded vowing to take the "necessary countermeasures."

China says it will hold more trade talks with US in Beijing

Domestic equity benchmarks BSE Sensex and NSE Nifty were trading on a choppy note early Friday amid uncertainty over <a href="https://www.wionews.com/business-economy/asian-shares-near-two-month-lows-ahead-of-looming-us-tariff-hike-217382">US-China trade deal </a>and continued foreign fund outflow.

After opening over 150 points higher, the 30-share index turned cautious and fell 17.32 points, or 0.15 per cent, to 37,541.59. The broader NSE Nifty was trading below the 11,300 level at 11,285.75.

In the previous session on Thursday, the BSE bourse closed 230.22 points, or 0.61 per cent, down at 37,558.91, and the broader NSE Nifty shed 57.65 points, or 0.51 per cent, to settle at 11,301.80.

Among the top losers in early session were HCL Tech, Asian Paints, Bajaj Finance, HUL, IndusInd Bank, PowerGrid, L&amp;T, Kotak Bank, ITC and Sun Pharma, shedding up to 4.31 per cent.

On the other hand, RIL, Tata Motors, HDFC twins, Axis Bank, Bharti Airtel, ICICI Bank and TCS were the top gainers, rising up to 1.04 per cent. &nbsp;

According to traders, investors were cautious ahead of the outcome of the 11th round of talks aimed at ending the trade war between the world's two largest economies.

Trump on Thursday accused China of trying to renegotiate a trade deal that has been negotiated after months of efforts and asserted he will not let that happen.

However, he said last night he received a "very beautiful letter" from the Chinese President Xi Jinping, and that it is possible that the US and China will enter into a trade deal.

Meanwhile, the Trump Administration Friday imposed increased tariffs on import of Chinese products over $200 billion worth from 10 per cent to 25 per cent.

Sustained foreign fund outflow too weighed on investor sentiment here, traders said.

Foreign institutional investors (FIIs) sold equity worth Rs 655.36 crore on Thursday, while domestic institutional investors (DIIs) purchased shares to the tune of Rs 677.91 crore, provisional data available with stock exchanges showed.

Bourses in Shanghai, Hong Kong, Tokyo and Seoul were trading higher in early trade.

On Wall Street, S&amp;P500 and Nasdaq Composite indices ended lower on Thursday.&nbsp;

On the currency front, the rupee depreciated 7 paise to 70.01 against the US dollar.

Brent crude futures, the global oil benchmark, were <a href="https://www.wionews.com/business-economy/oil-rallies-on-hopes-for-us-china-trade-deal-217381">trading 0.33 per cent lower at $70.62 per barrel</a>.&nbsp;

Domestic equity benchmarks BSE Sensex and NSE Nifty were trading on a choppy note early Friday amid uncertainty over US-China trade deal and continued foreign fund outflow.

Domestic equity benchmarks BSE Sensex and NSE Nifty were trading on a choppy note early Friday amid uncertainty over US-China trade deal and continued foreign fund outflow. After opening over 150 points higher, the 30-share index turned cautious and fell 17.32 points, or 0.15 per cent, to 37,541.59. The broader NSE Nifty was trading below the 11,300 level at 11,285.75. In the previous session on Thursday, the BSE bourse closed 230.22 points, or 0.61 per cent, down at 37,558.91, and the broader NSE Nifty shed 57.65 points, or 0.51 per cent, to settle at 11,301.80. Among the top losers in early session were HCL Tech, Asian Paints, Bajaj Finance, HUL, IndusInd Bank, PowerGrid, L&T, Kotak Bank, ITC and Sun Pharma, shedding up to 4.31 per cent. On the other hand, RIL, Tata Motors, HDFC twins, Axis Bank, Bharti Airtel, ICICI Bank and TCS were the top gainers, rising up to 1.04 per cent. According to traders, investors were cautious ahead of the outcome of the 11th round of talks aimed at ending the trade war between the world's two largest economies. Trump on Thursday accused China of trying to renegotiate a trade deal that has been negotiated after months of efforts and asserted he will not let that happen. However, he said last night he received a "very beautiful letter" from the Chinese President Xi Jinping, and that it is possible that the US and China will enter into a trade deal. Meanwhile, the Trump Administration Friday imposed increased tariffs on import of Chinese products over $200 billion worth from 10 per cent to 25 per cent. Sustained foreign fund outflow too weighed on investor sentiment here, traders said. Foreign institutional investors (FIIs) sold equity worth Rs 655.36 crore on Thursday, while domestic institutional investors (DIIs) purchased shares to the tune of Rs 677.91 crore, provisional data available with stock exchanges showed. Bourses in Shanghai, Hong Kong, Tokyo and Seoul were trading higher in early trade. On Wall Street, S&P500 and Nasdaq Composite indices ended lower on Thursday. On the currency front, the rupee depreciated 7 paise to 70.01 against the US dollar. Brent crude futures, the global oil benchmark, were trading 0.33 per cent lower at $70.62 per barrel.

Sensex, Nifty turn choppy; HCL Tech rallies 4%

Brent oil hit a 2019 high above $72 a barrel on Wednesday, propelled by steady economic growth in<a href="https://www.wionews.com/business-economy/oil-prices-edge-higher-on-opec-cuts-sanctions-on-iran-venezuela-209184"> China and a fall in US&nbsp;crude</a> stocks which defied expectations and signalled firm demand, while global supply remained tight.

International benchmark Brent crude futures were up 28 cents, or 0.39 per cent, at $72 by 0910 GMT, having hit an intraday peak of $72.24.

US&nbsp;West Texas Intermediate (WTI) crude futures were at $64.39 per barrel, up 34 cents or 0.53 per cent and just shy of a 2019 high of $64.79 hit last week.

China's economy grew by 6.4 per cent in the first quarter, official data showed, defying expectations for a further slowdown and assuaging global markets as a US-China trade deal also appears near.

Refinery throughput in China - the world's second-largest crude user - rose 3.2 per cent in March from a year earlier to 12.49 million barrels per day (bpd).

"The demand side of the equation got a substantial fillip via today's China data suggesting prices will continue to move higher on improving global growth and risk sentiment," said Stephen Innes, head of trading at SPI Asset Management.

Prices have been supported this year by a pact reached by the Organization of the Petroleum Exporting Countries and allies, including Russia, to limit their oil output by 1.2 million bpd.

Global supply has been tightened further by US&nbsp;sanctions on OPEC members Venezuela and Iran.

Iran's crude exports have dropped in April to their lowest daily level this year, tanker data showed and industry sources said, suggesting a drawdown in buyer interest ahead of expected further pressure from Washington.

"Buyers are shying away in view of US&nbsp;policy uncertainty regarding waivers to import Iranian crude oil," BNP Paribas strategist Harry Tchilinguirian told the Reuters Global Oil Forum.

In June, OPEC and its partners will decide whether to extend their agreement, but Russia's willingness to stick with the cuts now looks less clear.

Gazprom Neft, the oil arm of Russian gas company Gazprom, expects the global oil deal to end in the first half of the year, a company official said on Tuesday.

An unexpected drop in US&nbsp;crude inventories also supported oil prices. Stockpiles fell by 3.1 million barrels in the week ended April 12 to 452.7 million barrels, data from the American Petroleum Institute (API) showed.

Official data on US&nbsp;inventories from the Energy Information Administration is due on Wednesday.

Brent oil hit a 2019 high above $72 a barrel on Wednesday, propelled by steady economic growth in China and a fall in US crude stocks which defied expectations and signalled firm demand, while global supply remained tight.

Brent oil hit a 2019 high above $72 a barrel on Wednesday, propelled by steady economic growth in China and a fall in US crude stocks which defied expectations and signalled firm demand, while global supply remained tight. International benchmark Brent crude futures were up 28 cents, or 0.39 per cent, at $72 by 0910 GMT, having hit an intraday peak of $72.24. US West Texas Intermediate (WTI) crude futures were at $64.39 per barrel, up 34 cents or 0.53 per cent and just shy of a 2019 high of $64.79 hit last week. China's economy grew by 6.4 per cent in the first quarter, official data showed, defying expectations for a further slowdown and assuaging global markets as a US-China trade deal also appears near. Refinery throughput in China - the world's second-largest crude user - rose 3.2 per cent in March from a year earlier to 12.49 million barrels per day (bpd). "The demand side of the equation got a substantial fillip via today's China data suggesting prices will continue to move higher on improving global growth and risk sentiment," said Stephen Innes, head of trading at SPI Asset Management. Prices have been supported this year by a pact reached by the Organization of the Petroleum Exporting Countries and allies, including Russia, to limit their oil output by 1.2 million bpd. Global supply has been tightened further by US sanctions on OPEC members Venezuela and Iran. Iran's crude exports have dropped in April to their lowest daily level this year, tanker data showed and industry sources said, suggesting a drawdown in buyer interest ahead of expected further pressure from Washington. "Buyers are shying away in view of US policy uncertainty regarding waivers to import Iranian crude oil," BNP Paribas strategist Harry Tchilinguirian told the Reuters Global Oil Forum. In June, OPEC and its partners will decide whether to extend their agreement, but Russia's willingness to stick with the cuts now looks less clear. Gazprom Neft, the oil arm of Russian gas company Gazprom, expects the global oil deal to end in the first half of the year, a company official said on Tuesday. An unexpected drop in US crude inventories also supported oil prices. Stockpiles fell by 3.1 million barrels in the week ended April 12 to 452.7 million barrels, data from the American Petroleum Institute (API) showed. Official data on US inventories from the Energy Information Administration is due on Wednesday.

International oil prices at record high in 2019

US President Donald Trump said on Wednesday a<a href="https://www.wionews.com/world/trump-team-has-no-plan-to-go-to-china-for-trade-talks-official-202115"> trade deal with Beijing </a>is coming along nicely, with US trade negotiators going to China next week for another round of talks.

"The deal is coming along nicely," he said to reporters at the White House. Trump said top US negotiators are going to China this weekend "to further the deal."

When asked about lifting tariffs on China, Trump said, "We’re not talking about removing them. We're talking about leaving them for a substantial period of time because we have to make sure that if we do the deal" China abides by it. He did not elaborate.

US&nbsp;Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin plan to travel to China next week for another round of trade talks, a Trump administration official said on Tuesday.

US President Donald Trump said on Wednesday a trade deal with Beijing is coming along nicely, with US trade negotiators going to China next week for another round of talks.

US President Donald Trump said on Wednesday a trade deal with Beijing is coming along nicely, with US trade negotiators going to China next week for another round of talks. "The deal is coming along nicely," he said to reporters at the White House. Trump said top US negotiators are going to China this weekend "to further the deal." When asked about lifting tariffs on China, Trump said, "We’re not talking about removing them. We're talking about leaving them for a substantial period of time because we have to make sure that if we do the deal" China abides by it. He did not elaborate. US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin plan to travel to China next week for another round of trade talks, a Trump administration official said on Tuesday.

Trump says trade deal 'coming along nicely' with China

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