US President Donald Trump signaled a possible turnaround in the trade war with China amid ongoing market volatility, stating that high tariffs on Chinese goods "will be significantly reduced, but will not be zero," writes CNN.
"145% is a lot, and they will not be that high," Trump said during a Q&A session with reporters in the Oval Office. "They will not be that high. It (the rate) will be significantly reduced. But it will not be zero."
Trump made these comments when asked about statements by Treasury Secretary Scott Bessent, who earlier that day said that high tariffs between the US and China have effectively imposed an embargo on trade between these countries. Bessent stated at a private investment conference organized by JP Morgan Chase that the trade war with China is unsustainable, and he expects the struggle to ease in the very near future, confirmed CNN by a person familiar with the matter.
This assessment sparked a rally on Wall Street, which had begun earlier on Tuesday: all three major US stock indices reached their highest marks for the day after Bessent's statements were made public.
Asian stocks also rose on Wednesday, with Hong Kong's Hang Seng index leading the regional growth, ending the trading day more than 2% higher. Japan's Nikkei 225 index rose by about 2%, and South Korea's Kospi increased by 1.5%.
On Wednesday, responding to questions about Trump's and Bessent's comments, China's foreign ministry stated that the US should "stop its threats and coercion and engage with China on the basis of equality, mutual respect, and reciprocity" if they want to make a deal.
"China's position on the trade war initiated by the US is crystal clear: we do not want to fight, but we are not afraid to fight. If it comes to a fight, we will fight to the end. If it comes to negotiations, our door is wide open," said Xi Jinping.
The two largest economies in the world have imposed record tariffs on each other in a rapidly escalating struggle that has undermined global markets, disrupted supply chains, and raised fears of a recession.
On Tuesday, Trump again expressed hope that Xi Jinping will come to the negotiating table and promised "to be very nice." "We will be very nice. They will be very nice, and we will see what happens," the president said. "But ultimately, they have to make a deal because otherwise, they cannot operate in the United States, and we want them to be part of it."
Photo: The New York Times