The Blubber

China is seeking several actions from President Donald Trump’s administration before agreeing to resume trade negotiations, according to a person familiar with the Chinese government's position.

Among the key expectations are that Washington demonstrate greater consistency in its messaging, address Beijing’s concerns over sanctions and Taiwan, and show more respect—particularly by reducing critical remarks from members of the U.S. cabinet, the person said, speaking on condition of anonymity to discuss internal deliberations.

Beijing also wants the U.S. to designate a lead negotiator who has direct backing from President Trump and can facilitate a deal for him and President Xi Jinping to eventually endorse in a formal meeting, the person added.

With U.S.-China tensions escalating, the direction of the global economy and financial markets increasingly hinges on whether the two nations can avert a prolonged trade conflict. Since returning to office, Trump has imposed 145% tariffs on most Chinese imports, prompting retaliatory measures from Beijing and straining bilateral trade.

Following news of China’s position, the offshore yuan rose 0.2% against the dollar, and the Australian dollar—often seen as a proxy for China—climbed 0.5%. Futures tied to the S&P 500 Index trimmed losses to 0.4% after being down as much as 1.6% earlier in the day.

The sweeping U.S. tariff measures have garnered strong public support within China for reciprocal action, which has, in turn, reduced the political incentive for Xi to respond to Trump’s repeated calls for direct talks.

A major sticking point, the person familiar with the matter said, is the perception in Beijing that dialogue must be rooted in mutual respect. While Trump has typically spoken in moderate terms about Xi, other members of his administration have adopted a more critical tone, leaving Chinese officials uncertain about the administration’s actual stance.

Chinese leadership believes Trump now has firm control over his administration, the person said. Consequently, when U.S. officials make provocative statements and Trump does not publicly disassociate himself from them, Beijing assumes the president supports those views.

While the source did not mention specific remarks, recent comments by Vice President JD Vance referring to “Chinese peasants” drew particular backlash. Chinese Foreign Ministry spokesperson Lin Jian labeled the remarks “ignorant and disrespectful” last week, in a rare direct criticism of a senior U.S. official.