US Treasury Sec Bessent signals confidence in US jobs outlook
Comments from US Treasury Secretary Scott Bessent on Wednesday offered a broad snapshot of the US administration’s thinking on the labour market, trade policy and energy security, as markets continue to navigate heightened geopolitical tensions and renewed volatility in oil prices.
Key takeaways
On the labour market, Scott Bessent struck an optimistic tone, saying he remains bullish on job creation this year. He emphasised that sustainable employment gains must come from the private sector, adding that the recent strength in temporary employment is often an early signal of broader hiring momentum.
On trade policy, Bessent indicated that tariffs could rise to around 15% sometime this week, though he suggested the move would likely be temporary. Rates are expected to revert to previous levels in roughly five months, while the administration conducts additional Section 301 and Section 232 reviews.
Energy markets were another focus. Bessent argued that crude markets remain well supplied, noting that significant volumes of oil remain outside the Gulf region. He added that the United States is coordinating with other countries and could take steps to ensure safe tanker passage if needed.
He also highlighted China’s vulnerability on the energy front, noting that the country’s reliance on imported crude leaves it exposed to potential disruptions in global supply chains.
US-China Trade War FAQs
Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living.
An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies.
The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
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