Confusion erupts in Trump’s cabinet over China trade negotiations

Confusion hit the White House hard on Sunday when Trump’s top officials couldn’t agree if talks with China over tariffs were even happening.

President Donald Trump has been telling reporters for many days now that discussions were moving along and he had spoken to Chinese President Xi Jinping.

But Chinese officials denied that any talks were taking place, throwing a wrench into the already messy trade situation. The fight between the world’s two biggest economies has made markets jumpy and raised real fears of a recession, according to Reuters.

Last week, Trump’s administration showed some signs that they might want to pull back from the trade war that has been battering businesses across the globe. Trump said that negotiations were active, but China quickly said otherwise, making it clear that no talks were currently happening. That contradiction opened the door to more questions about how serious any progress might actually be.

Bessent and Rollins send mixed messages on trade talks

Treasury Secretary Scott Bessent, one of the main players in US trade talks, said during interviews that he met his Chinese counterparts last week during the International Monetary Fund meetings in Washington. However, Bessent made it clear that they didn’t even talk about tariffs.

Speaking on ABC’s “This Week,” Bessent said, “I had interaction with my Chinese counterpart, but it was more on the traditional things like financial stability, global economic early warnings. I don’t know if President Trump has spoken with President Xi.”

Agriculture Secretary Brooke Rollins painted a different picture during an interview on CNN’s “State of the Union.” Rollins claimed, “Every day we are in conversation with China, along with those other 99, 100 countries that have come to the table,” suggesting that talks were happening regularly.

This totally clashed with what Scott Bessent said, showing that even Trump’s team wasn’t on the same page about what was actually going on.

Scott, who last week warned that reaching any real agreement with Beijing would be a “slog,” refused to put any deadline on a possible deal. He explained that while a full trade agreement could take months to sort out, a basic understanding to stop new tariffs could happen faster.

Scott also pointed out that even a simple de-escalation would help prevent tariffs from jumping up to their highest possible levels. The chaos didn’t stop there. Trump’s unpredictable use of tariffs has already hit major US trading partners like Canada, Mexico, and China.

His tactics have pushed market volatility through the roof and destroyed a lot of investor trust in American assets. Businesses, especially those tied into international supply chains, have been scrambling to adjust to the constant policy swings.

China moves to protect economy as trade war drags on

While Washington stayed tangled in confusion, China started putting real measures in place to help businesses survive the growing tension. Xi Jinping chaired a meeting of the Politburo, China’s second most powerful political body, on Friday.

During the meeting, officials promised “targeted measures” to support businesses facing “increased external shocks.” The Politburo meeting came right as new tit-for-tat tariffs from both sides topped 100% this month, causing Wall Street banks to slash their forecasts for China’s GDP growth this year.

Even with these hits, China is still chasing a growth goal of “around 5%” that was set back in March. A translated readout of the meeting showed that Chinese leaders called for “multiple measures to help businesses in difficulty,” including providing financial support.

They also said they wanted a “timely reduction” in interest rates and a cut to the reserve requirement ratio, which dictates how much cash banks are required to hold.

Zong Liang, chief researcher at the Bank of China, said policymakers are staying with their earlier economic strategies but are ready to act with more targeted help if needed.

In a rare move back in March, China raised its deficit target to 4% of GDP. Finance Minister Lan Fo’an said then that China had plenty of space to push more aggressive fiscal policies if necessary.

Since this latest escalation in US-China trade tensions, local Chinese governments and major companies have been working to redirect export goods back into the domestic market to soften the blow from lost foreign sales.

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