U.S.-China Trade Talks: A Potential Rebalancing Act

U.S. Treasury Secretary Scott Bessent suggests a possible de-escalation in U.S.-China trade tensions, but highlights upcoming negotiations as challenging. He describes the current trade situation as unsustainable, with hopes for economic rebalancing. However, China's readiness to shift towards increased consumption remains uncertain.

During a closed presentation at a JP Morgan conference, U.S. Treasury Secretary Scott Bessent expressed optimism for a de-escalation in the ongoing U.S.-China trade tensions. He cautioned, however, that future negotiations with Beijing are expected to be arduous.

Bessent criticized the current trade status between the nations as unsustainable. According to sources, he emphasized that the Trump administration did not intend to sever ties between the world's largest economies.

Bessent advocated for a significant economic shift, with hopes that China would increase consumer activity while the U.S. boosts manufacturing. Yet, he conveyed doubts about China's preparedness to embrace such changes.

(With inputs from agencies.)