Trade tensions between the US and China seem to be easing, as officials from both countries released statements on Sunday expressing a readiness to rekindle trade negotiations, sparking optimism among analysts for a market recovery.
In a translated statement, China’s Ministry of Commerce declared its intent to “enhance dialogue” with other nations concerning trade and the recent rare earth mineral export controls that heightened tensions with the US.
The representatives further indicated that China would “seriously evaluate” aspects of the rare earth export policy to promote trade and reinforce supply chains, including “license exemptions.” On the same day, US President Trump released this statement:
“Don’t worry about China, it will all be fine! Highly respected President Xi just had a moment of weakness. He doesn’t desire a downturn for his nation, and neither do I. The USA aims to assist China, not to harm it!!!”
China’s announcement regarding rare earth exports triggered a reaction from President Donald Trump on Friday that led to a significant downturn in crypto markets, marking the worst 24-hour liquidation in crypto history.
The softened communication could imply a de-escalation of tensions between the two nations, potentially bringing an end to months of global trade strife caused by Trump’s trade tariffs, which have unsettled financial markets.
Related: Bitcoin crashes to $102K on Binance as Trump declares 100% tariffs on China
Investment analysts and crypto industry leaders express optimism
“Should President Trump de-escalate on Sunday, markets are poised for a significant rally on Monday. Market reactions to Trump’s communications remain exceptionally vigorous,” analysts from The Kobeissi Letter noted on Sunday.
On Friday, Trump asserted that there was “no reason” to meet with China’s President, Xi Jinping, at the upcoming Asia-Pacific Economic Cooperation (APEC) summit in Seoul, Korea, starting October 31, in response to China’s rare earth export restrictions.
Trump also announced further 100% tariffs on China as a reaction to the suggested rare earth export controls.
However, Jeff Park, an advisor at Bitwise, stated that the meeting between Trump and Xi Jinping is “assured to occur.”
“It’s unrelated to tariffs,” Park maintained, noting that Trump will likely attend due to his interest in “historic memorabilia, photo opportunities, and extravagant ceremonies to ensure his legacy.”
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