The U.S. and China agreed to trade agreement that will see the U.S. reduce tariffs

The U.S. and China agreed to the first phase of a broader trade agreement that will see the U.S. reduce tariffs. The deal announced hinges on China increasing purchases of American farm goods such as soybeans and pork, and making new commitments on intellectual property, forced technology transfer and currency. The U.S. will also suspend new import taxes that were set to take effect on Sunday covering $160 billion of products such as smartphones and toys, said U.S. Trade Representative Robert Lighthizer. The Asian nation committed to increase imports of U.S. goods and services by no less than $200 billion more than the 2017 level over the next two years, he said. That would be more than double the $187 billion in goods and services the U.S. exported to China in 2017. In return, Trump agreed to reduce some existing U.S. tariffs, halving 15% duties on $120 billion of imports but maintaining a 25% levy on some $250 billion of Chinese goods. (Bloomberg)

The yield on the benchmark 10-year Treasury note fell about 7 basis points to around 1.824%, while the yield on the 30-year Treasury bond was also lower at around 2.255%. China and the U.S. have reached an agreement on text of a phase one trade deal and will now move toward signing a deal as quickly as possible, Chinese officials said Friday. President Donald Trump said Friday that Washington will not charge Beijing with any new tariffs. (CNBC)


Source: Danareksa Sekuritas Debt Research
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