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Hopes of an imminent breakthrough in the US-China trade war are driving Britain’s stock market to a five-week high this morning, as shares rally across Europe.
China’s commerce ministry has pumped up expectations of a deal, by revealing that both sides have agreed in principle to lift tariffs, in stages, as part of a preliminary agreement.
Reuters’ Beijing bureau has the details:
China and the United States must simultaneously cancel some existing tariffs on each other’s goods for both sides to reach a “phase one” trade deal, the Chinese commerce ministry said on Thursday.
The proportion of tariffs cancelled must be the same, and how much tariffs should be cancelled can be negotiated, said Gao Feng, spokesman at the commerce ministry.
Both sides have agreed in the past two weeks to cancel the additional tariffs imposed during their months-long trade war in different phases, Gao said.
Importantly, the two sides are still talking – so they’ve not actually reached a Phase One deal yet.
But there’s relief that both sides are talking about removing some of the hurdles to trade, which have hampered the global economy for more than a year. US stock futures are also pushing higher.