Currently, the White House is considering a currency pact with China. According to those familiar with the discussions, the WH may also suspend a tariff increase next week. The US agreed to the monetary pact before the demolition of trade talks earlier this year. The White House sees it as part of a first phase deal with Beijing. Further negotiations on core issues such as intellectual property and forced technology transfer should follow.
The internal deliberations of the Chinese negotiating team will be led by Vice Premier Liu He. In Washington they will resume trade negotiations with the US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin starting Thursday. It is the first personal conversation between senior officials since July.
Discussions come as the Trump administration further increased pressure on Beijing this week; blacklisting Chinese technology companies for their alleged role in oppressing Muslims in the western Xinjiang region. Trump issued visa bans on civil servants that are related to the mass imprisonment of Muslims. At the same time, a dispute over freedom of expression between China and the NBA was triggered by a tweet supporting the Hong Kong protesters. Furthermore, the Trump administration officially declared China a currency manipulator last August. These instances have highlighted the tensions between the US and China.
A Chinese official said on Wednesday that the country was still open to a partial trade deal with the US that could include large purchases of American goods. However, such an agreement depends on President Trump ceasing further tariffs. Showing progress on a currency pact and other matters this week could serve as a reason to postpone the tariff increase next week. Bloomberg News reported last month that the White House is discussing plans for an interim deal.