Gao Feng, spokesman for the PRC Ministry of Commerce, seemed to confirm that the US has agreed to proportionally remove existing tariffs as part of a phase one trade deal, as we discussed in the newsletter earlier this week. The markets got very excited about this statement, but so far I have not see any official confirmation from the US side. Perhaps it will come in a presidential tweet at some point.

We may also see presidential Twitter praise for the PRC’s public trial and sentencing of several fentanyl traffickers. Cracking down on fentanyl has been a core US demand, and this move by the Chinese government will be seen as a sign of good faith towards satisfying something President Trump has wanted very badly.

So overall the optimism for a phase one trade deal does not look unreasonable, but talk of that deal somehow putting a floor under the declining trajectory of the US-China relationship does.

Bytedance’s TikTok app has had a rough week in the US media and US legislature. As a pa…