Key Points
-
Tariffs on China could go down to 80% ahead of talks.
-
The New York Post suggests it could go down to as low as 50%.
-
President Donald Trump himself appears fine with tariffs at 80%, and he seems to be leaving it up to Scott Bessent.
-
Your future is too important to leave to chance. See if you’re on track for retirement by taking this simple quiz and matching with a fiduciary financial advisor serving your area. It only takes a moment, and is totally free. Click here to begin. (sponsor)
The stock market has opened slightly green today after President Donald Trump hinted that tariffs on China could go down soon. This is after weeks of posturing that tariffs will not be reduced unilaterally, and China would have to engage in negotiations first. Before that, the president hoped that China’s president would call him to talk about trade and tariffs instead.
Regardless, trade talks with China are a positive development, and the possible reduction of tariffs to 80% would pave the way for mutual de-escalation on both sides. According to the New York Post, tariffs on China could go down to as low as 50%.
President Donald Trump may have concluded that the aggressive posturing on trade against China was not giving him the results he wanted, so he may now be doing the opposite instead. It is still hard to say whether or not this will happen, since there have been plenty of surprises on trade policy from the current administration.
Here’s a market update as of 10:00 A.M (ET) today.
- The S&P 500 is up 22.29 points, or 0.39%.
- The Nasdaq Composite is up 114.6 points, or 0.63%.
- The Dow Jones Industrial Average is up 82.67 points, or 0.2%.
Wall Street Optimistic on Trump’s Comments
The stock market has gone up on the news, but not by as much as many would have liked. Still, the comments from Trump have given investors a lot of optimism.
He made the following comments:
- “China should open up its market to USA”.
- “Closed markets don’t work anymore”.
- “[Regarding tax increase on the rich] Republicans should probably not do it, but I’m OK if they do!!!”
- “80% Tariff on China seems right! It’s up to Scott Bessent”.
According to Lutnick, “De-escalation with China is Bessent’s goal in talks.” So, the tariff reduction could indeed go through.
His trade adviser Navarro also made the following comments:
- “[On trade talks with China] It will be an interesting weekend for the markets.”
- “Japan is most clever at protecting its own markets.”
- “Countries are lining up to talk trade with the US.”
- “The EU is very high on the priority list in trade talks.”
Bearish Comments From the Fed’s Williams
Comments from the Federal Reserve’s John C. Williams, who is the president of the Federal Reserve Bank of New York, have caused some concerns. He made the following comments:
- “I expect growth to slow considerably, and inflation and unemployment to be higher.”
- “Key to think through scenarios in times of uncertainty.”
- “We are focused on keeping inflation as close to target as possible.”
“Factors keeping the long-run neutral rate low are still in place. I still see the long-run neutral rate as quite low.” - “There is a lot of uncertainty around trade policy.”
- “The economy is currently in a good place.”
- “The Fed has time, policy is in a good place to see what happens.”
The schedule for today is entirely devoid of notable macro data. Instead, it is the Federal Reserve that will be moving the markets. Fed’s Williams, Barr, Kugler, Goolsbee, and Williams (yes, again), and then Musalem have been scheduled to give their opinions on the economy.
Other Assets
- Gold is up 1% to $3,338.
- Crude Oil Futures are up 1% to $60.5.
- Natural Gas Futures are up 5.46%.
- Bitcoin is up 0.28% to $103,393.
The image featured at the top of this post is ©Openverse.