U.S. and Chinese officials concluded two days of talks in Stockholm on Tuesday that were aimed at tackling longstanding economic disputes and stepping back from an escalating trade war between the world’s two biggest economies.
While announcing no breakthroughs, China’s top trade negotiator, Li Chenggang, said the two sides agreed to push for an extension of a 90-day tariff truce struck in mid-May, without specifying when and for how long such an extension could come into force.
Traders are staring down a pivotal week that will likely set the tone for the rest of the year in markets and the economy.
The talks could pave the way for a meeting between U.S. President Donald Trump and Chinese President Xi Jinping later in the year, though Trump denied going out of his way to seek one, and Chinese officials did not mention it.
After months of threatening high tariffs on trading partners, Trump has secured trade deals with the European Union, Japan, and others, but China’s powerhouse economy and grip on global rare earth flows make these talks particularly complex.
Both sides in May walked back from imposing triple-digit tariffs on each other in what would have amounted to a bilateral trade embargo. But global supply chains and financial markets could face renewed turmoil without an agreement.
Underlining the stakes, the International Monetary Fund on Tuesday raised its global growth forecast but flagged a potential rebound in tariff rates as a major risk.