Markets of Asia received a good news in the initial hours of Monday. The U.S. along with China agreed to put a halt to their ongoing tariff wars are planning to reinitiate trade negotiations. The decision came after US president Donald Trump held a meeting with China’s president Xi Jinping along the lines of the G-20 Summit held recently in Japan on Saturday. Trump announced that even though the current tariffs will still be in force, there will be a pause on any new tariffs for a while. The U.S. President has claimed that the talks have gone better than the expectations held by the U.S. camp and that “we are going to work with China where we left off.”
However, irrespective of Trump’s apparent optimism, both the U.S. and China are still holding out at their positions and refusing to budge ever so slightly. This puts serious doubts about how long it would need the two parties to be able to forge a deal with is equally appealing for both the parties. There have been no formal discussions between the two parties since all negotiations had broken down during the early May.
Post an almost two month long trade war between two of the biggest economies in the world and the conclusion of the G-20 Summit, the risk market has responded in a positive manner to this plan to renegotiate trades. Markets all over Asia showed a majority in growth as response to this news as investors had a sigh of relief because the tariff war came to an end.