The halt is the latest sign that the hard-won phase-one trade deal between the world’s two biggest economies is in jeopardy
Chinese government officials told major state-run agricultural companies to pause purchases of some American farm goods including soybeans as Beijing evaluates the ongoing escalation of tensions with the U.S. over Hong Kong, according to people familiar with the situation.
Beijing’s move eroded the risk-on sentiment that had been prevailing over markets. S&P 500 Index futures gave up gains to trade 0.6 per cent lower, while U.S. 10-year bonds erased declines. The onshore yuan reversed its advance, while soybean futures in Chicago, which had been as much as 1 per cent higher, were little changed.
Nobody from the commerce ministry responded to a fax seeking comment. Officials from Sinograin and Cofco also didn’t respond to calls. While Trump has periodically threatened to call off the “phase one” trade deal, his top economic advisers have suggested it would continue. Larry Kudlow, director of the National Economic Council, told CNBC on Thursday that the trade agreement “does continue to go on for the moment and we may be making progress there.”
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