China stands firm in trade war: There are no talks, U.S. should move first
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Chinese President Xi Jinping addresses a gathering of business leaders. Photo: Ken Ishii-Pool/Getty Images
The Chinese government asserted Thursday that no talks are happening with the U.S. about de-escalating the trade war, and called on the Trump administration to make the first move.
Why it matters: Someone has to blink.
Driving the news: There are "absolutely no negotiations" happening between the two sides on trade, CNBC quoted a spokesperson for the Chinese Commerce Ministry as saying.
- That same spokesperson reportedly called on the U.S. to cancel all "unilateral" measures.
- The comments follow a flurry of news from the U.S. side Wednesday, with Treasury Secretary Scott Bessent acknowledging the trade war was "unsustainable," and President Trump signaling the U.S. might eventually move on tariff rates even without Chinese participation.
The other side: Despite China's insistence no one was talking, President Trump told reporters Thursday that conversations were happening.
- "Well, they had a meeting this morning," Trump said when asked about the Chinese statement. "Doesn't matter who 'they' is. We may reveal it later, but they had meetings this morning, and we've been meeting with China."
The big picture: Commerce is plunging between the world's two largest economies.
- Big retailers warned Trump this week that empty shelves are just a couple of weeks away, while key port operators say inbound shipments are dwindling rapidly.
- Meanwhile, voters have soured on Trump's economic performance, after nearly a decade of consistently giving him the benefit of the doubt.
The intrigue: There are signs of small pockets of daylight.
- The FT and ABC News reported the administration was at least considering some tariff changes on Chinese auto parts, though the White House has said no decision has been made.
Yes, but: The glimmers of hope weren't enough to cheer financial markets, which fell again Thursday after the Chinese comments.
- The dollar weakened, and gold resumed its rally, as investors sought safe havens.
What to watch: Whether the U.S. continues to send signals it's open to a deal, and how, if at all, China reciprocates.
- In the meantime, investors — who've experienced wild swings worth trillions of dollars all month long — will continue to be whipsawed.
- "This volatility is likely to continue until we get a clearer policy outlook from both the Trump administration and China on a resolution to trade policy," Catalyst Funds chief investment officer David Miller wrote in a note this week.
Editor's note: This story has been updated with comments by President Trump.
