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US Treasury secretary Scott Bessent has cautioned that any de-escalation within the US-China trade war would should be mutual, denying suggestions that President Donald Trump would unilaterally cut levies on Chinese goods.
Chatting with reporters on Wednesday, Bessent said “there would should be a de-escalation by each side”, echoing comments he made to a JPMorgan conference on Tuesday, where he warned that the US-China trade war was “not sustainable”.
Bessent said the high level of tariffs the US and China had imposed on one another was “the equivalent of an embargo”. Trump has imposed a 145 per cent levy on Chinese goods and Beijing has retaliated with an obligation of 125 per cent.
“A break between the 2 countries on trade doesn’t suit anybody’s interests,” Bessent said.
When asked if the US would make a unilateral offer to de-escalate trade tensions with China, Bessent responded: “By no means.”
His remarks got here after The Wall Street Journal on Wednesday said Trump was considering unilaterally cutting tariffs on China.
When asked in a while Wednesday how soon the US could cut tariffs on China, Trump told reporters “that will depend on them”.
Responding to an issue on whether he was anxious concerning the impact that his 145 per cent tariff on Chinese goods was having on American small businesses, Trump replied: “No”.
“It’s a high tariff, but I haven’t brought it down,” he said. “It mainly means China’s not doing any business with us . . . since it’s a really high number.”
Trump added that the US and China were in direct contact “daily”. Officials have had working-level engagements over the past few months, but there have been no negotiations about trade.
US stocks gave back a few of their earlier gains on the back of Bessent’s comments, with the blue-chip S&P 500 ending the day 1.7 per cent higher in Recent York. The tech-heavy Nasdaq Composite gained 2.5 per cent.
Each indices had sold off heavily on Monday on concerns that Trump was considering firing US Federal Reserve chair Jay Powell. On Tuesday, the president reassured markets by saying he had “no intention” of sacking him.
“Uncertainty and inconsistency are economic poison,” said Steven Grey, chief investment officer at Grey Value Management. “By endlessly reversing itself and reneging on earlier commitments, this White House has permanently conditioned everyone to take its statements with a grain of salt.”
Bessent cautioned that the 2 countries had not held any trade talks. Sources conversant in the discussions in Washington and Beijing have said that China had made clear that it viewed Trump’s tariffs as a type of economic bullying and is not going to capitulate.
“Each side are waiting to talk to the opposite,” said Bessent, who wouldn’t be drawn on the timing of any talks.
Asked about China’s stance that the US was using the tariffs as a type of bullying, Trump said: “China has been charging us massive tariffs for a few years . . . now we’re reversing it.”
Bessent told investors on the JPMorgan conference that based on data from two weeks ago, maritime container bookings from China to Washington had fallen by 64 per cent.
“It’s each a blessing and a curse that the strongest relationship is on the very top,” he said. “So it’s between President Xi [Jinping] and President Trump, and clearly, in any de-escalation, the talks wouldn’t begin on the very top, so I don’t have a timeframe.”
Trump has said he wants to barter with Xi, however the Chinese have made clear that they might not consider a phone call, yet alone a summit, until officials from each side had hammered out the contours of a possible trade deal.
One person conversant in the situation said the chief executives of Walmart and Goal had delivered a stark warning to Trump concerning the impact that the tariffs were having on trade in a White House meeting on Monday.
A Recent York investor stressed that it was very hard to interpret the comments from Bessent and Trump. “Who the heck knows what weight you assign to [Bessent’s comments on China and Trump’s pivot on Powell],” the person said. “The market is a perpetual yo-yo.”
