Lutnick says negotiations between the U.S. and China positive 

A Chinese delegation led by Vice Premier He Lifeng met yesterday with U.S. Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent, and other representatives at the Lancaster House to discuss settling their trade dispute. As negotiations enter day two, President Donald Trump said today that China is not easy, but the U.S. is doing well in the talks. 

U.S. Treasury yields have slipped amid the negotiations, with the 10-year Treasury yield dropping by four basis points to 4.446% as of 9.54 a.m. ET. The 2-year yield slipped by one basis point to 3.993%. The 30-year  yield fell by three basis points to 4.921%.

Lutnick says negotiations between the U.S. and China positive 

Howard Lutnick, U.S Commerce Secretary, revealed today that the trade talks seeking a breakthrough on export controls were going well. The two countries met today for the second time in the UK after the first round of negotiations in Geneva, which experienced agreement violations from both sides.  

📈 US stock futures in the green today

Day 2 of US–China trade talks underway — markets are pricing in a positive outcome. A successful deal could push the S&P 500 to new ATH, analysts say.

🇯🇵 Japan’s economy minister also set to visit the US this week for tariff talks.

Macro… pic.twitter.com/MGmwbGea7c

— Vladislav 🥃 (@v_poltavetss) June 10, 2025

According to White House economic adviser Kevin Hassett, the U.S. may lift the recently imposed tariff on semiconductors if China agrees to speed up the delivery of rare earth minerals crucial to the robotics and AI industry in the U.S. Trump’s shifting tariff policies have caused congestion and confusion in major ports and caused companies to lose a lot of money in sales and high costs. Markets have, however, made up much of the losses that were aided by the Geneva meeting between the two countries, according to Lutnick. 

Customs data showed on Monday that China’s exports to the U.S. dropped by 34.5% in May, considered the biggest since the COVID-19 outbreak. China holds most of the rare earth magnets, which are critical to electric vehicles, and its decision to suspend exports in April affected the global supply chain. 

The U.S. retaliated in May by revoking the previously issued license and halting shipments of semiconductor design software, chemicals, and aviation equipment. Hasset expects any export control measures from the U.S. to be eased once rare earths are released in volume after the London negotiations. He added that the easing would not include the high-end Nvidia chips over concerns that they may be utilized by China’s DeepSeek model and other military applications. 

Deflation fears put pressure on the Chinese government to negotiate

Ed Yardeni, president of Yardeni Research, argued that Deflation worries in China pressure them to negotiate a trade deal with Trump that benefits both countries. According to the Chinese Bureau of Statistics, China’s consumer prices fell four times consecutively this year, with a CPI of 0.1% in May.

The World Bank has also warned that Trump tariffs will force the global economy to grow at the slowest pace since the 1960s during this decade. The Washington-based lender adjusted its growth forecast by 0.4% to 2.3%, which marks the worst since the 2008 financial crisis. The Bank added that 2027 global growth will average just 2.5%.  The World Bank warned that global growth is slowing due to a rise in trade barriers and the corrupt effects of market uncertainties.

Indermit Gill, Chief Economist at the World Bank, said that the world economy is running into turbulence and that without a swift course correction, the harm to living standards could deepen.  The FTSE 100 UK stock index climbed by 0.32 % today, above the record close it achieved in March. Analysts believe the index rally was influenced by renewed hopes that the two giant economies could pause the ongoing trade wars during their meeting in London.

Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now