US President Donald Trump said today that the trade talks between the US and China were going well.
He tweeted: “Good things are happening at China Trade Talk Meeting. Warmer feelings than in recent past, more like the Old Days. I will be meeting with the Vice Premier today. All would like to see something significant happen!”
The news boosted US markets, with the S&P 500 climbing 1.57 per cent and the Dow up 1.5 per cent.
European markets also rose with Germany’s Dax up 2.47 per cent and France’s Cac 40 up 1.45 per cent.
Trump also said that the advantage of the China trade deal was that it did not need congressional approval so could be implemented quickly.
“One of the great things about the China Deal is the fact that, for various reasons, we do not have to go through the very long and politically complex Congressional Approval Process. When the deal is fully negotiated, I sign it myself on behalf of our Country. Fast and Clean!” He said.
Chris Beauchamp, chief market analyst at IG, said: “Equity markets have rather taken it as a given that something will be done, and have attempted to replicate last week’s rally with the aim this time of continuing into the rest of the quarter. Again, the risk of disappointment is high, but even the President seems keen on getting something done. But a partial deal still leaves plenty of room for fallout further down the line, something that should give investors pause for thought.”
If negotiators cannot reach a deal, a new set of punitive US tariffs kicks in on 15 October on about $250bn (£197.5bn) of Chinese goods, and then both countries put tariffs on billions of dollars more of each others’ goods on 15 December.
On 15 October tariffs on at least $250bn of Chinese goods is set to increase from 25 per cent to 30 per cent.
The new rate was scheduled to kick in on 1 October, but was pushed back by Trump in late September as a gesture of goodwill.