China President Xi Jinping didn’t say much new in a highly anticipated Tuesday speech, but his emphasis on past pledges to open up the country’s economy and the lack of any aggressive new rhetoric was enough to soothe market worries about a U. S.-China trade war for now.
Sometimes it’s what you don’t say that resonates.
China President Xi Jinping offered little in the way of concessions in Beijing’s trade flap with the U. S. in a high-profile speech Tuesday. But he didn’t escalate the situation, either. And that was enough to send markets off to the races, analysts said.
“What President Xi didn’t say at the Boao Forum matters more than what he did,” said Kit Juckes, global macro strategist at Société Générale, in a note titled, “President Xi says nothing at all (so ‘Party on’ dudes).”
“There are plenty of reforms to come, including reduced auto tariffs, but no details. But the lack of any ramping-up of the U. S./Chinese trade-war-by-rhetoric was the key for equities to rally,” Juckes said.
While headlines focused on Xi’s pledge to open China’s markets and reduce tariffs on auto imports, China watchers noted that few of the items were new and that many had been outlined in previous speeches, including Xi’s high profile address at the World Economic Forum’s 2017 annual meeting in Davos, Switzerland.
maybe i am obtuse but i read Xi’s speech in the original Chinese and I don’t see any signs of concessions to Trump on trade
While markets are cheering, Trump administration trade officials are likely to dismiss the speech “as cobbled together offers of yesteryear rather than signs of a breakthrough,” said Scott Kennedy, director of the Project on Chinese Business and Political Economy at the Center for Strategic and International Studies, a Washington think tank.
