The US and China have been talking about trade for over 18 months now and after several rounds of tit-for-tat tariffs that Mr Trump and Mr Xi imposed on China and US products, the so-called “big deadline” for this “mega deal” that Mr Trump has been negotiating will arrive soon. Starting on 15 December the US was scheduled to slap on 15% tariffs on $160 billion dollars of goods being imported from China. Of course, the have been discussions for a “Phase One” or somewhat smaller deal, and with it, Mr Trump as told China he wants them to purchase more US agricultural products.
The sides have talked for over a year and a half but have yet to sign a deal, even a smaller version of the big deal. Of course, this has frustrated markets with some volatility being the result of recent fails over the past 6 months. This news about a delay in tariff hikes actually gave markets a boost, equity markets are now rallying in Asia. Note that products being targeted by the Trump White House are phones, clothes, and laptops. Tariffs due to be increased on Sunday 15 December could be marked at a later date, perhaps in February.