Trade Talks Update: China, US Working On 6 Memorandums As Deal Takes Shape | WHAT REALLY HAPPENED


Trade Talks Update: China, US Working On 6 Memorandums As Deal Takes Shape

After a week of trade headlines that has been dominated by President Trump's insistence that talks are seeing "their most significant progress yet" and that the US has been pressing Beijing to commit to keeping the yuan "stable" to preclude any tariff-offsetting devaluations, the progress on a "memorandums of understanding" has emerged as a primary point of interest for Wall Street.

But amid conflicting reports about Beijing's willingness to bend to US demands about its currency (on Thursday morning, the PBOC affirmed that they would keep the yuan "basically stable"), Bloomberg reported late Wednesday evening that the two sides are actually working on multiple MoUs that could cover agriculture, non-tariff barriers, services, technology transfer and IP. While the details are still unclear, it's believed that the agreements would include an "enforcement mechanism" that would lead to tariffs automatically being reimposed should China violate the agreement. It is worth reminding that a MoU tends to not be worth the paper it is printed on absent a separate broader deal, which is still sorely lacking.

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