China and the United States postponed a meeting between their two leaders to at least April as U.S. President Donald Trump exclaimed ‘he was in no hurry’ to seal a trade deal between the two economic adversaries. This development came on the heels of China announcing its industrial production growth was at the lowest level in decades. The optimism over a possible solution to the trade war between China and America has evaporated in the financial markets.
The hints that not all is well were there, even if the market chose to ignore them: earlier this week, U.S. Trade Representative Robert Lighthizer pointed to “major issues” still unresolved in the talks, with few signs of a breakthrough on the most difficult subjects including treatment of intellectual property. Chinese officials have also prickled at the appearance of the deal being one-sided, and are wary of the risk of Trump walking away even if Xi were to travel to the U.S, reported Zero Hedge.
The Trump tariffs have dampened China’s roaring economy and the production numbers will almost ensure further monetary easing from Beijing.
“The latest data should partially ease concerns about a sharp slowdown at the start of the year. But the near-term outlook still looks downbeat,” Capital Economics said in a note, quoted Reuters.