Donald Trump, the President of the United States, has pick up the phone to Chinese President Xi Jinping. Beijing’s Ministry of Foreign Affairs confirmed the news. This call comes at a very urgent time. Through the Trade War trade relations between the two nations have been under tremendous tension, particularly over the last week. Trump’s eagerness to engage directly with Xi has made news in the past few weeks—see for example this piece from Politico.
Chinese state media outlet Xinhua later confirmed the phone call. It’s intended to address the retrenchment in trade relations around the globe. In recent weeks, the relationship between the U.S. and China has deteriorated further, prompting concerns among investors and market analysts. The outcome of such contentious trade relations has made a significant dent in the global economy, triggering selloffs in U.S. stock futures.
Immediately following the announcement of the call, U.S. stock futures rose. This latest rally is an indication that investors really appreciated the fact that both of these leaders remained open to having a dialogue. Last week, CNBC reported a surprising, yet promising, development. It could be a sign of progress towards solving at least some of the issues that have marred U.S.-China trade relations.
The Foreign Ministry in Beijing quickly corroborated the call. They announced no quantitative specifics on what the discussions entail. Analysts say that this kind of communication could go a long way toward lowering the temperature. It would help create a friendlier overall ecosystem of collaboration between the two economic juggernauts.
Trump’s initiative to reach out to Xi reflects his administration’s ongoing efforts to navigate complex trade issues and mitigate any potential fallout from escalating tariffs and restrictions. The U.S. and China have been embroiled in a multi-year trade war. This ongoing conflict has affected all sectors of the economy and consumers in both countries.