Published: Sat, October 13, 2018
Finance | By Cynthia Curry

China says in 'communication' amid report of Trump-Xi meet

China says in 'communication' amid report of Trump-Xi meet

The United States and China are now locked in an escalating trade war with the Trump administration imposing penalty tariffs on billions of dollars in Chinese goods and China retaliating by targeting USA products including soybeans for penalty tariffs.

Chinese exports to the American market rose by 13 percent over a year to $46.7bn, down from August's 13.4 percent growth, customs data showed on Friday.

Export numbers have been buoyed by producers rushing to fill orders before American tariffs rose, but they also benefit from "robust US demand" and a weaker Chinese currency, which makes their goods cheaper overseas, Louis Kuijs of Oxford Economics said in a report.

U.S. President Donald Trump warned on Thursday there was much more he could do that would hurt China's economy further, showing no signs of backing off an escalating trade war with Beijing.

Trump told Fox News on Thursday that previous USA administrations had allowed China to pursue unfair trade for too long and that it was time for him to stop it.

The growing trade war prompted the International Monetary Fund on Tuesday to cut its global economic growth forecasts for 2018 and 2019.

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China's stock market has plunged this year but the trade war has also started to erode Trump's oft-touted USA stock gains, with the Dow Jones Industrial Average down more than five percent for the week.

Yet the prospects remain highly uncertain as to whether the preparing to consider lifting penalty tariffs on about $250 billion of Chinese products, triggering retaliation by China. This makes Chinese products cheaper overseas.

And Huo Jianguo, a trade expert at the Center for China and Globalization in Beijing, tells the Post that Trump might want to rethink his trade strategy when he sees that the trade deficit with China has only widened under his watch.

But he and Xi Jinping will have a chance to work things out when they meet likely next month on the sidelines of the G20 summit. "Their economy has gone down very substantially". "The fight won't end in the blink of an eye, considering it is between the world's two biggest economies".

Shipments into the country last month stood at 37.12 million tonnes, or 9.05 million barrels per day (bpd), up from 9.04 million bpd in August and marking their third straight monthly rise, according to numbers from the General Administration of Customs. "I've reflected that to them", Mnuchin said in a TV interview on CNBC.

Concerns have been raised that China, the largest foreign holder of U.S. Treasury bonds, might start dumping its holdings as a way to bring more pressure on the United States in the trade dispute.

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