China Says U.S. Trade Talks Are Important, but Multilateralism Is ‘Indispensable’
China stated that trade negotiations with the United States are an important step to bridge differences, but multilateralism is “indispensable” to finding a way out of global trade turmoil. At a World Trade Organization (WTO) Council meeting, China called on member states to stabilize trade relations and bring trade measures within WTO rules. “Unilateral tariffs and threats of ‘reciprocal tariffs’ are akin to adding fuel to the fire and are completely wrong,” China said. “An open, stable, and rules-based international economic and trade order serves the common interests of all countries.”
G7 Finance Leaders Seek to Play Down Tariff Disputes and Find Consensus, Avoid Repeating the G6+1 Fiasco
Finance leaders of the Group of Seven (G7) met on Wednesday to seek to downplay controversies surrounding U.S. President Trump’s tariffs and find some common ground. Participants said G7 finance ministers and central bank governors are striving to issue a joint communiqué covering non-tariff issues, including support for Ukraine, threats from non-market economic policies in countries like China, and the fight against financial crime and drug trafficking. However, sources from G7 delegations said it remains unclear whether leaders can agree on the wording of the joint communiqué. Consultations on the joint statement are expected to continue into Wednesday evening and Thursday morning.
EU Launches Anti-Dumping Probe into Chinese Tires over Alleged Dumping
Following a complaint from the EU tire industry, the European Commission launched an investigation to determine whether anti-dumping measures are necessary against passenger car and light truck tires imported from China. The Commission’s statement said, “The investigation should be concluded within 14 months of initiation. If dumping and resulting injury are provisionally established, provisional anti-dumping measures could be imposed within eight months.”
U.S. 20-Year Bond Auction Meets Weak Demand, Signaling Investor Anxiety over Fiscal Outlook
The U.S. Treasury’s auction of $16 billion in 20-year bonds saw weak demand, as investors fretted over the country’s growing debt burden. The poor auction performance triggered declines in stocks and the U.S. dollar, while U.S. Treasury yields rose, indicating heightened investor concerns about government debt expansion. This may also prompt bond market vigilantes to push for greater fiscal restraint in Washington.
Morgan Stanley Turns Bullish on Most U.S. Assets—Except the Dollar
Morgan Stanley has turned bullish on most major U.S. assets, upgrading its ratings on U.S. stocks and Treasury bonds to “overweight,” citing reduced tariff uncertainty, the unlikelihood of a recession, and room for further interest rate cuts. The dollar is an exception: in a report, Morgan Stanley said the dollar is expected to remain under pressure as U.S. interest rates and economic growth converge with those of other countries.
