China president Xi Jinping may have alleviated fears of a trade war for now, but things aren't bright and rosy just yet
The crux of Xi's speech is that he promises to open up China's economy further and to lower tariffs (the same pledge that Li Keqiang made last month at the NPC).
The former isn't something new as it is the same stance that his government has been preaching for quite some time now and without offering much specifics on that as well as the tariffs mentioned, have things really changed?
Markets are cheering that Xi did not escalate tensions of a trade war any higher than it is, but in my view he hasn't really done much to relieve it either. The only real comfort for risk sentiment is that Xi's stance appears to be more conciliatory and that we could in fact see negotiations between Trump and himself.
But it feels like that there's still a long way to go for that to happen. Trump surely won't be blinded by Xi's promises today - and until something is actually done, they are but empty promises - so the key question will be how much further he wants to pursue his protectionist stance against China in the coming days/weeks?
If he does decide to continue down the tariffs path, the events of today would not have changed a thing in the trade spat between the two countries.
