There was a flurry of bilateral meetings during the G20 over the weekend. Trump was in the limelight, especially given his meetings with Xi and Kim. This came within our expectations heading into the weekend. We believe that these had been part of Trump’s rhetoric for bilateral negotiations.
The most significant outcome was the U.S.-China trade truce, as Trump and Xi agreed to delay tariffs and negotiate further. This has been helped by Trump’s backtrack on a Huawei ban in the U.S.
We note that this has been a complete U-turn from his messages earlier the week.
In addition, Trump met with Kim on June 30 at the Korea Demilitarized Zone. We think that this will likely help with restarting future working-level discussions between the U.S. and North Korea on denuclearization.
Besides, Trump also came out of meetings with Indian Prime Minister Narendra Modi on a somewhat positive note. This is despite both countries having taken protectionist stances recently, alongside other geopolitical issues.
Overall, the most significant development in our view has been the delay of any further tariffs.
Despite all the positive vibes over the weekend, we remain skeptical of actual progress in future working-level negotiations. Trump’s conciliatory tone and constant changes in his tone may be part of his negotiation strategy and his rhetoric for the 2020 Presidential Elections.
Given that the “noise” is likely to persist in the months ahead, we will prefer to focus on the actions undertaken ahead.