Japan Nikkei falls on global economic growth, US-China trade talks woes

Clay Curtis
February 10, 2019

CNBC first reported Thursday that Trump may not meet with Xi before March 1, citing a senior administration official. The U.S. and China are trying to meet an early March trade deadline.

It's not clear what will happen if a trade deal isn't struck by the deadline.

A person briefed on the talks said that Trump's advisers were concerned that accepting a meeting invitation at this stage would raise unfounded expectations for a quick deal and erode USA leverage in the talks, where the two sides remain far apart on core structural intellectual property issues.

In a meeting at the White House Wednesday, Trump's trade team discussed the next steps for the trade talks, according to a person briefed on the matter.

Larry Kudlow, White House economic adviser, told reporters that the two leaders could still meet at a later date.

Asian stocks tumbled Friday on worries the US and China won't reach an agreement. But the president and other senior administration officials have publicly and privately stated the negotiations are going well and that the two sides are continuing to bridge their differences at every round of talks.

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The US has threatened to increase tariffs on $200 billion worth of Chinese goods to 25 per cent from 10 per cent if a deal is not reached by March 2.

Trump, who made the comments on Thursday during two days of negotiations between American and Chinese trade officials, suggested a face-to-face meeting could be combined with his trip to Asia later this month for a second meeting with North Korean leader Kim Jong-un, reports The New York Times. Treasury Secretary Steve Mnuchin and the US Trade Representative Robert Lighthizer are expected in China next week to deploy the third round of negotiations between the two countries that have lasted since late previous year.

Washington complaints about technology transfers and intellectual property protections, along with accusations of Chinese cybertheft of U.S. trade secrets and a systematic campaign to acquire U.S. technology firms, were used by Trump's administration to justify punitive tariffs on $250bn worth of Chinese imports.

"Trump meeting Xi makes it more likely any deal will last".

The negative mood sweeping across financial markets late in the trading week continues to highlight how investor sentiment remains extremely sensitive to any changes in the narrative with US-China trade developments. Three sources familiar with the matter indicated that report was wrong.

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