Chinese trade officials on Friday afternoon canceled their scheduled visit to U.S. farm states next week, putting a damper on an otherwise seemingly positive few weeks on the trade front. All three of the major U.S. averages turned lower on the news.
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Earlier Friday, the U.S. Trade Representative’s office exempted several big-ticket items produced in China from tariffs, a development that may boost the odds of a trade deal between Washington and Beijing.
The exemptions on more than 400 Chinese goods -- including large items such as motorcycles, parts for rail cars and certain solar panels as well as smaller merchandise from dog leashes and harnesses to electrical tape and power tools -- are seen as a way of gutting the tariffs without completely removing them, and have boosted spirits for the deputy-level talks that are underway in Washington before higher-level discussions.
“The big show is when Liu He, the chief negotiator for China, sits down with Bob Lightheizer sometime in the next couple weeks,” Peter Navarro, assistant to President Trump, told “Mornings with Maria.”
The two sides had moved closer to a deal in the spring when negotiations collapsed and the White House blamed China for backing away from key provisions.
“I think the issue is going to be where the negotiations will start from," Navarro said. "Will they start from where they left off when China reneged on the 150-page deal or not?”
Neither the U.S. Trade Representative nor industry trade groups immediately responded to FOX Business’ request for comment.
The three sets of exclusions from 25 percent tariffs include:
- 310 items from List 1, which covered $34 billion worth of goods
- 89 items from List 2, which covered $16 billion worth of goods
- 38 items from List 3, which covered $200 billion worth of goods
Friday morning's announcement was the latest de-escalation of the trade war that has seen the U.S. and China slap tariffs on hundreds of billions of dollars of one another’s goods, and comes as the two sides have returned to the negotiating table.
Last week, President Trump announced that tariff increases scheduled to hit $250 billion worth of Chinese goods on Oct. 1 will be delayed until Oct. 15 out of respect for 70th-anniversary celebrations in the People's Republic of China.
Beijing reciprocated the goodwill gesture by exempting U.S. soybeans and pork from additional tariffs.
Last month, Trump said the U.S. would delay tariffs on some goods until Dec. 15 as to not disrupt the holiday shopping season.
FOX Business' Edward Lawrence contributed to this report.