China and the US soon to reach agreement on trade issues?
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Week Ahead
Next week will see the end of the 90-day period granted by the US to the Chinese leadership to make progress on the trade dispute at the negotiating table. Should the talks fail, the US threatens to raise tariffs on Chinese imports of USD 200bn to 25% from the current 10%. Although a comprehensive solution to the conflict is not yet in sight, both sides are likely to have come closer in recent weeks (President Trump is meeting Chinese chief negotiator Liu He in Washington today). This rapprochement has increased the likelihood that the US will extend the March 1 deadline so that negotiations can continue. This positive turnaround has contributed significantly to increased demand for riskier asset classes in recent days.