Days after Scott Bessent dazzled JP Morgan with closed-door comments (aka not Main Street) that the tariff standoff with China is unsustainable, the US Treasury Secretary is set to deliver comments on Wednesday at the IIF Global Outlook Forum regarding the state of the global financial system as the Trump administration seeks to tamp down rhetoric over China.
The comments also come after President Donald Trump softened his tone on the unfolding trade war between the world’s two largest economies – to which China’s foreign ministry spokesman, Guo Jiakun replied “our doors are wide open.“
“We don’t want a trade war, but we are not afraid of it. If the U.S. truly wants to resolve issues through dialogue and negotiation, it should stop threatening and blackmailing, and engage in dialogue with China based on equality, mutual respect, and mutual benefit,” Guo told China’s state-run Global Times.
According to Tuesday comments by Trump, “very high” tariffs on Chinese imports will “come down substantially, but it won’t be zero.”
“I think we’re going to live together very happily and ideally work together, so I think it’s going to work out very well,” Trump told reporters at the White House.
Trump notably excluded China from a pause on “reciprocal” tariffs that were extended to other trading partners in order to allow them time to negotiate – blaming China’s retaliatory actions for its exclusion.
The China tariffs include a 125% reciprocal tariff on top of Trump’s original 20% tariff related to the fentanyl trade. Combined with pre-existing Section 301 tariffs, some Chinese goods face levies as high as 245%.
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