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Trump says China trade war strategy is ‘doing very well,’ won’t change

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President Donald Trump doubled down on his approach toward trade negotiations with China on Monday, suggesting a week of whiplash developments between the largest economies was par for the course.

Speaking at a press conference at the Group of Seven summit in Biarritz, France, Trump said he was not concerned that his increasingly volatile stance toward China would undermine stability in the global economy.

“Sorry! It’s the way I negotiate,” he told reporters. “It’s done very well for me over the years. It’s doing very well for the country.”

The comment came after a dizzying week of economic messages from the White House, which have sown confusion among businesses and investors.

Trump said Monday China asked the US to restart negotiations in a series of phone calls between high-level officials on Sunday, but the details remained elusive. He also praised President Xi Jinping as “a great leader who happens to be a brilliant man,” days after portraying him as an “enemy” of the US.

Foreign Ministry spokesman Geng Shuang said he was “not aware” of the phone calls Trump had mentioned Monday. The Global Times, an organ of the Chinese Communist Party, also questioned the newfound optimism.

“Based on what I know, Chinese and US top negotiators didn’t hold phone talks in recent days,” Global Times editor Hu Xijin wrote in a tweet. “The two sides have been keeping contact at technical level, it doesn’t have significance that President Trump suggested. China didn’t change its position. China won’t cave to US pressure.”

Trump has sought to cast a positive light on trade negotiations with China following a tumultuous week in financial markets. Stocks, which Trump has long portrayed as a measure of his success in office, dropped sharply Friday after a rapid series of tariff escalations between the two sides.

On Friday, the Trump administration raised existing tariff rates on China after the country said it would retaliate against escalations scheduled to begin on September 1. In a reversal early this month, Trump announced in a tweet he would move forward with plans to extend duties to all remaining imports from China.

Trump appeared to signal regret about the dispute with China on Sunday, suggesting to reporters that he had “second thoughts” about it. But the White House said in a statement hours later that Trump only regretted that he had not raised tariffs higher, raising uncertainty further.

“The most important secondary effect might be the unpredictability of the rules of the game for doing international business, which could weigh on business sentiment and hold back incremental investment in future growth opportunities,” said Jason Pride, the chief investment officer of private wealth at Glenmede.

The closely-watched yield curve inverted this month for the first time since before the global financial crisis in 2007, setting off alarm among investors who viewed it as a sign that a US recession could be ahead.

The Trump administration has publicly downplayed concerns about a recession and the widespread consensus that its tariffs could contribute to one. Yet it has at the same time sought ways to counter one, including a push for further tax cuts and interest-rate cuts

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