‘Gradual’ US tariffs on China may foreground Trump-Xi summit: Citi
As Trump’s promised day-one tariffs on China failed to appear, a Citi economist has posited import duties may come slower than expected
With much-anticipated trade actions against China absent on the first day of US President Donald Trump’s second term, a chief Citi economist said there are better odds of “delayed, gradual tariffs” being imposed on the world’s second-largest economy in advance of potential direct negotiations between the two countries’ leaders.
A slower onset of tariffs on China’s US-bound imports would “create conditions” for a potential summit between Trump and Chinese President Xi Jinping, the financial services firm’s chief China economist Yu Xiangrong wrote in a research note on Tuesday.
“US-China relations under Trump 2.0 have had a better than expected start,” Yu said. The economist added that if tariff hikes occur steadily, it would present an upside risk to the bank’s forecast for China’s 2025 gross domestic product growth and market sentiment as a whole.
As a gesture, he added, China could agree to cooperate on hot-button issues such as fentanyl trafficking while making “meaningful concessions” on imports from the US and increasing access to its market for American firms.
In his inaugural address on Monday, Trump – while issuing broad warnings of tariffs and speaking of the need to protect American workers – did not specifically mention China or outline any punitive measures, as he had frequently during his campaign.
