Trump Signs Order Extending China Tariff Truce By 90 Days, White House Says

The United States and China on Monday extended a tariff truce for another 90 days, staving off triple-digit duties on Chinese goods as U.S. retailers get ready to ramp up inventories ahead of the critical end-of-year holiday season.U.S. President Donald Trump announced on his Truth Social platform that he had signed an executive order suspending the imposition of higher tariffs until 12:01 a.m. EST on November 10, with all other elements of the truce to remain in place.China's Commerce Ministry issued parallel moves early local China time on Tuesday, saying it would adopt and maintain all necessary measures to suspend or remove non-tariff measures.

Trump on Sunday had demanded China quadruple its purchases of U.S. soybeans, but the order included no mention of any additional purchases."The United States continues to have discussions with the PRC to address the lack of trade reciprocity in our economic relationship and our resulting national and economic security concerns," Trump's executive order stated. "Through these discussions, (China) continues to take significant steps toward remedying non-reciprocal trade arrangements and addressing the concerns of the United States relating to economic and national security matters."

The tariff truce between Beijing and Washington had been due to expire on Tuesday at 12:01 a.m. EDT (0401 GMT). The extension until early November buys crucial time for the seasonal autumn surge of imports for the Christmas season, including electronics, apparel and toys at lower tariff rates.The new order prevents U.S. tariffs on Chinese goods from shooting up to 145%, while Chinese tariffs on U.S. goods were set to hit 125% - rates that would have resulted in a virtual trade embargo between the two countries. It locks in place - at least for now - a 30% tariff on Chinese imports, with Chinese duties on U.S. imports at 10%."We'll see what happens," Trump told a news conference earlier on Monday, highlighting what he called his good relationship with Chinese President Xi Jinping.

Trump told CNBC last week that the U.S. and China were getting very close to a trade agreement and he would meet with Xi before the end of the year if a deal was struck."It's positive news," said Wendy Cutler, a former senior U.S. trade official who is now a vice president at the Asia Society Policy Institute. "Combined with some of the de-escalatory steps both the United States and China have taken in recent weeks, it demonstrated that both sides are trying to see if they can reach some kind of a deal that would lay the groundwork for a Xi-Trump meeting this fall."

TRADE 'DETENTE' CONTINUED

The two sides in May announced a truce in their trade dispute after talks in Geneva, Switzerland, agreeing to a 90-day period to allow further talks. They met again in Stockholm, Sweden, in late July, and U.S. negotiators returned to Washington with a recommendation that Trump extend the deadline.Treasury Secretary Scott Bessent has said repeatedly that the triple-digit import duties both sides slapped on each other's goods in the spring were untenable and had essentially imposed a trade embargo between the world's two largest economies."It wouldn’t be a Trump-style negotiation if it didn’t go right down to the wire," said Kelly Ann Shaw, a senior White House trade official during Trump's first term and now with law firm Akin Gump Strauss Hauer & Feld.

She said Trump had likely pressed China for further concessions before agreeing to the extension. Trump pushed for additional concessions on Sunday, urging China to quadruple its soybean purchases, although analysts questioned the feasibility of any such deal. Trump did not repeat the demand on Monday.

"The whole reason for the 90-day pause in the first place was to lay the groundwork for broader negotiations and there’s been a lot of noise about everything from soybeans to export controls to excess capacity over the weekend," Shaw said.Ryan Majerus, a former U.S. trade official now with the King & Spalding law firm, said the news would give both sides more time to work through longstanding trade concerns.“This will undoubtedly lower anxiety on both sides as talks continue, and as the U.S. and China work toward a framework deal in the fall," he said.

Imports from China early this year had surged to beat Trump's tariffs, but dropped steeply in June, Commerce Department data showed last week. The U.S. trade deficit with China tumbled by roughly a third in June to $9.5 billion, its narrowest since February 2004. Over five consecutive months of declines, the U.S. trade gap with China has narrowed by $22.2 billion - a 70% reduction from a year earlier.Washington has also been pressing Beijing to stop buying Russian oil, with Trump threatening to impose secondary tariffs on China.

Source: Reuters

Oil prices rose on Tuesday as the United States and China extended a pause on higher tariffs, easing concerns an escalation of their trade war would disrupt their economies and crimp fuel demand in the world's two largest oil consumers.

Brent crude futuresgained 26 cents, or 0.39%, to $66.89 a barrel by 0015 GMT, while U.S. West Texas Intermediate crude futuresrose 22 cents, or 0.34%, to $64.18.

U.S. President Donald Trump extended a tariff truce with China by another 90 days, a White House official said on Monday, staving off triple-digit duties on Chinese goods as U.S. retailers prepared for the critical end-of-year holiday season.

This raised hopes that an agreement could be attained between the world's two largest economies, and could help sidestep a virtual trade embargo between them. Tariffs risk slowing down economic growth, which could sap global fuel demand and drag oil prices lower.

Investors are also looking ahead to a meeting between Trump and Russian President Vladimir Putin on August 15 in Alaska to negotiate an end to the war in Ukraine.

The meeting is set amid heightened U.S. pressure on Russia, with the threat of harsher penalties on Russian oil buyers such as China and India if no peace deal is reached that could upset oil trade flows.

"Any peace deal between Russia and Ukraine would end the risk of disruption to Russian oil that has been hovering over the market," ANZ senior commodity strategist Daniel Hynes wrote in a note.

Trump set a deadline of last Friday for Russia to agree to peace in Ukraine or have its oil buyers face secondary sanctions, while pressing India to reduce purchases of Russian oil.

Washington has also been pressing Beijing to stop buying Russian oil, with Trump threatening to impose secondary tariffs on China.

The risk of those sanctions being enacted has receded ahead of the August 15 Trump-Putin meeting.

Also on the radar is U.S. inflation data later in the day, that could hint at the Federal Reserve's interest rate path. Any sign that the central bank may cut rates soon would support crude prices.

Source: Reuters

The Federal Reserve’s two vice chairs, Michelle Bowman and Philip Jefferson, and Dallas Fed President Lorie Logan are under consideration to serve as chair of the central bank when the position opens next year, according to two administration officials.

Treasury Secretary Scott Bessent, who is running the search, will interview additional candidates in the coming weeks, said the officials, who were granted anonymity to speak candidly about the process. The president is expected to make his final announcement this fall, they said.

Others who remain under consideration include Kevin Hassett, a close economic adviser to Trump, Fed Governor Christopher Waller, economist Marc Sumerlin and former Fed officials Kevin Warsh and James Bullard, the people said.

Last week, Trump nominated Stephen Miran, chair of the White House’s Council of Economic Advisers, to fill a seat on the Fed’s Board of Governors that expires at the end of January. The post opened when Adriana Kugler announced her early departure.

With Miran’s nomination headed to the Senate for confirmation, the Trump team doesn’t feel the need to rush the search for a chair, the officials said.

Bessent will interview all the candidates for chair, and then make a recommendation to the president on a short-list to meet with, the officials said.

Trump, who believes interest rates are too high, has this year directed unrelenting criticism at the Fed — and especially Chair Jerome Powell, whom he picked for the job in 2017.

The Fed’s next policy meeting is scheduled for Sept. 16-17 in Washington.

But Trump’s options for replacing Powell may be more limited than is typical. Fed chairs traditionally leave the central bank when their terms run out. But Powell has declined to say whether he’ll depart in May. If he chooses, he can stay on as a governor until 2028.

That means Trump must either put his intended chair into the seat Miran will hold until January, and promote them come May, or select someone already on the Board of Governors, which includes Bowman and Jefferson.

Any nomination to place an outsider on the board, or to elevate a governor to chair, will require Senate confirmation.

Trump appointed Bowman to the Fed in 2018 and made her vice chair for supervision — the central bank’s top regulator — this year. When the Fed’s rate-setting panel held interest rates steady for a fifth straight time in July, Bowman and Waller dissented in favor of a quarter-percentage-point cut.

Jefferson was appointed to the board by President Joe Biden in 2022 and then appointed vice chair in 2023, also by Biden. He was confirmed each time with broad bipartisan support.

At the time of Jefferson’s first nomination, Hasset, a former colleague at Columbia University, had high praise for him.

“Phil Jefferson is someone I would have been 100% comfortable telling President Trump to nominate to the Federal Reserve,” Hassett said. “He’s exactly the kind of person I want at the Fed.”

Jefferson, who would be the Fed’s first Black chair, has supported the decisions taken this year to hold rates steady.

Logan was selected by directors at the Dallas Fed to take the top job there in 2022. She previously worked at the New York Fed as manager of the Fed’s massive securities portfolio. She has also supported keeping rates unchanged this year, speaking frequently about the need to guard against tariff-driven inflation.

The panel that sets rates, the Federal Open Market Committee, is composed of all seven Fed governors, the president of the New York Fed and, on a rotating basis, four of the remaining 11 regional presidents.

The Dallas president holds a vote in 2026.

Hassett has already spoken with Trump about the chairmanship, and Warsh was considered in 2017 for the role but was passed over for Powell.

Trump also considered Warsh for Treasury secretary in November. Waller has met with the Trump team, which came away impressed with his willingness to move on policy based on forecasting, rather than current data, and his deep knowledge of the Fed system as a whole, Bloomberg News reported last week.

Source: Bloomberg Europe

Source: Cryptoslate

President Donald Trump said Monday imports of gold will not face US tariffs, weighing in after a federal ruling caused chaos and confusion in global bullion markets.

“Gold will not be Tariffed!” Trump posted on social media.

Gold futures traded on New York’s Comex and the global benchmark for spot prices in London were little-changed after Trump’s post. Spot gold pared some losses, though it was still down more than 1.2% on the day.

No formal, updated policy had yet been posted by US agencies as of Monday afternoon.

A White House official suggested last week the administration would issue a new policy clarifying whether gold bars would face import taxes, after US Customs and Border Protection stunned traders by deciding the imports would be subject to duties.

The ruling determined that one-kilogram and 100-ounce gold bars would be subject to Trump’s country-based tariffs that took effect Aug. 7. The move came in the form of a letter that was issued to a Swiss refiner inquiring about gold’s treatment, then posted publicly on the agency’s website.

Had the decision remained in place, it would have had sweeping implications for bullion around the world and potentially for the smooth functioning of the US futures contract. Gold’s role as a financial asset and global currency sets it apart from other commodities such as copper that have been roiled by tariffs.

Traders, analysts and executives across the industry had understood the bars would be exempt from Trump’s so-called “reciprocal” tariffs,” including a 39% levy on goods from Switzerland, a major exporter.

The confusion over the CBP letter had caused US gold futures to surge to a record on Friday, and traders said that shipments were freezing up in response to the shock news.

Bullion markets stabilized later Friday when a White House official told Bloomberg in a written statement that the Trump administration intends to post an executive order in the near future to clarify what it called misinformation about tariffing of gold and other specialty products.

The latest statement adds to a tumultuous year for gold, which has soared to unprecedented levels amid strong buying from central banks and as Trump’s trade war drives haven demand.

Earlier this year, physical flows were upended as traders rushed billions of dollars worth of gold and silver into the US as New York prices traded at large premiums in anticipation of potential tariffs. However, that trade came to a crashing halt after the US included gold and silver in its list of exemptions from the tariffs announced in early April.

Source: Bloomberg Europe

COMPLICATION FOR BOJ

Source: Reuters