Hong Kong, China (AFP) — Asian investors on Thursday cheered Donald Trump’s decision to delay a hike in tariffs on Chinese goods and Beijing’s announcement that it would remove a range of US products from its own planned levies.
The moves signal an easing of tensions between the two economic superpowers ahead of a much-anticipated meeting of top-level negotiators next month.
They also provided an extra shot in the arm for investors as they await key announcements from the US and European central banks that are expected to see a further easing of monetary policy.
In a tweet on Wednesday night, Trump said: “We have agreed, as a gesture of good will, to move the increased Tariffs on 250 Billion Dollars’ worth of goods (25 percent to 30 percent), from 1 October to 15 October.”
He added that the delay was requested by “Vice Premier of China, Liu He, and due to the fact that the People’s Republic of China will be celebrating their 70th Anniversary,” on 1 October.
Earlier in the day, China said it would temporarily exempt 16 categories of US exports from tariff increases in an olive branch to Washington before the talks take place and which Trump described as “a big move.”
The more conciliatory tone from both sides — after months of rancor — fueled hopes they can edge towards a solution to their long-running trade war, which has jolted the global economy and stock markets.
The delay “shows Trump doesn’t want to increase tariffs before the trade talks in early October and it creates good conditions,” said Tommy Xie, an economist at Oversea-Chinese Banking Corp.
“It adds to the hope that there’ll be good news from the October meeting, and markets will wait and see.”