Tensions between Chiba and the US have been running higher than normal this week after the well publicized dust-up in the South China Sea on Sunday. The meeting with the minister was scheduled long before the naval confrontation, according to the White House. Obama will need to use all his diplomatic skills to get the Chinese to buy a load of bonds while backing off on the naval front.
They will discuss currencies in their meeting, according to the White House.
Stocks have dipped after the news hit the tape and the dollar has weakened across the board. Oddly, Treasuries have soared this afternoon after the auction, so I guess they are not concerned about Chinese bond-buying, yet. EUR/USD trades at 1.2788 and USD/JPY at 97.10. 96.55 is support on further declines.
