French media: US-China trade negotiation agreement extended for another 90 days, is "ceasefire" good or bad?

Although progress has been made in extending the ceasefire, there have been no major breakthroughs in the negotiations, and everything depends on Trump's approval.

US and Chinese officials ended a two-day trade negotiation on Tuesday and reached a consensus to seek an extension of the existing 90-day ceasefire agreement. Although both sides agreed to extend the agreement, no major breakthroughs were announced.

US officials pointed out that whether to extend the ceasefire will be decided by US President Trump. US Treasury Secretary Bassett said that Trump will be the final decision-maker on whether to extend the ceasefire. He noted that within the next 90 days, both sides may meet again to further discuss the issue of China's rare earth circulation.

The news came as Trump was on his way back to Washington from Scotland. He told reporters on Air Force One that he would receive a briefing on the progress of the negotiations on Wednesday.

"I just got a call from Treasury Secretary Scott Basset. They had a very good meeting with the Chinese, and it looks like they will report to me tomorrow," Trump said. "We either approve or we don't approve. But he felt good about this meeting, better than yesterday."

The agreement will expire on August 12. If not extended, tariffs between the two countries could quickly rise again. Trump has recently reached trade agreements with trade partners such as the EU and Japan, but the negotiations with China have become particularly complex due to China's strong economic power and its control over the global rare earth supply chain. In May this year, both sides withdrew tariffs of up to three digits on each other, avoiding the risk of bilateral trade blockage. However, if this negotiation fails to reach an agreement, global supply chains and financial markets will face greater risks.

China's chief trade negotiator emphasized that both sides have fully recognized the importance of maintaining a stable and healthy economic and trade relationship. He stated that the United States and China will maintain positive communication and timely exchange opinions on economic and trade issues, continuing to promote the stable development of bilateral economic and trade relations.

In addition, the meeting also deeply discussed the issue of the transformation of the economic structures of the United States and China. US officials stated that China needs to shift from a state-led export-oriented manufacturing economy to an economic structure more reliant on domestic demand. This not only helps China's economic development, but also helps US exports to China.

With the US-China negotiations not having any decisive progress, Wall Street investors remain cautious. On the same day, the Federal Reserve is about to announce its interest rate decision, plus market concerns about high corporate valuations, which put pressure on the stock market. On Tuesday, the S&P 500 index fell after hitting a new high, while the Dow Jones Industrial Average and the Nasdaq 100 index also declined slightly. At the same time, strong demand for 7-year Treasury bonds led to a drop in yield, while the dollar rose against all developed country currencies, indicating capital flowing into safe-haven assets.

Although the International Monetary Fund (IMF) raised its global growth forecast, it still warned that if tariffs rise again, it could become a major risk to the global economic recovery. The IMF pointed out that global markets and supply chains are still affected by trade uncertainties and high tariffs. If the US and China fail to reach a longer-term trade agreement, it will further pressure global economic growth.

Source: rfi

Original article: https://www.toutiao.com/article/1839030399070220/

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