In recent remarks from the Oval Office, President Donald Trump made clear that the United States will not adopt a “hard ball” approach towards China, indicating that current tariffs on Chinese imports, which stand at 145 per cent, will be significantly reduced. When asked about the negotiation strategy with China and whether the COVID-19 pandemic would be mentioned, he firmly replied in the negative, stating, “No, no, we’re going to be very nice.”
Trump emphasised that a favourable deal is essential for both countries, highlighting that China must engage in negotiations to continue trading in the U.S. market. He remarked that while tariffs will not revert to zero, they will be lowered substantially from their current level. “It won’t be anywhere near that high,” he noted, underscoring his belief in the potential for a positive agreement between the two nations.
Although maintaining an amiable tone towards China, Trump’s comments also included reference to his relationship with the Federal Reserve. He stated that he has “no intention” of dismissing the Fed Chair Jerome Powell, while expressing a desire for more aggressive action on interest rates to help stimulate the economy amidst tariff-related uncertainties. He has recently criticised Powell, urging for a reduction in rates to facilitate economic growth.
These comments align with a broader concern presented by the International Monetary Fund (IMF) regarding the potential fallout from the unpredictable nature of tariff policies. The IMF has warned that such instability could have detrimental impacts on global economies, particularly affecting U.S. prosperity.
In summary, President Trump believes in a strategic pivot towards constructive negotiations with China over trade, advocating for substantial tariff reductions as part of a cooperative relationship while also pushing for monetary policy changes domestically.