On Monday, before the global markets opened, news from Trump emerged—he hinted at a willingness to lower tariffs on China at some point in the future.
Trump stated that he is willing to lower tariffs on China at some time, as the current tariffs are so high that the two largest economies in the world have essentially stopped trading with each other.
In an interview with Kristen Welker on NBC (meeting with the media), Trump stated: 'To some extent, I will lower tariffs, otherwise, you will never be able to do business with them, and they really want to do business.'
Trump also praised some recent remarks made by China as 'positive', while reiterating that any agreement reached between the two countries must be 'fair'.
The interview lasted an hour, during which Trump maintained a serious expression, making overtures to China twice. In recent weeks, he has continuously switched between 'escalation' and 'easing', signaling progress to the market while retaining strategic room to pressure China.
First, Trump and members of his economic team have recently frequently expressed 'confidence in reaching an agreement with China', and today he further stated his 'willingness to lower tariffs'. However, Trump still maintains strategic ambiguity (not clarifying under what conditions), and did not specify whether the reduction would occur before or after negotiations begin.
Second, Trump's action may be aimed at calming the market, hoping that the market's upward trend can continue. As the first trade agreement has yet to emerge, he needs to keep the market believing that progress is being made in trade. Currently, the market feedback is a beautiful vision of 'lower tariffs, lower interest rates, lower taxes', and Trump needs to meet market expectations, otherwise, recent gains may be reversed.
Future close attention is needed: 1) When will the US and China start formal contacts; 2) The specific content of mutual concessions in negotiations. Only with substantive progress and a measurable timeline can the medium- to long-term trends of the global market be truly determined.
