USA and China Start Investment Resumption Talks Before Trump’s Visit

In a movement that few expected given the aggressiveness of recent +10% tariffs, sources reveal that Beijing and Washington began to discuss ways to reactivate mutual investment.

By Igor PereiraFinancial Market Analyst

This dialogue takes place as a preparation for President Trump's official visit to China, scheduled for the period of 31 March to 2 April. Although the scope is not yet defined, this movement may be the "arrangement brake" that the stock market needs so much.

Both sides have shown interest in business models that avoid national security friction:

• The Template: The 2023 Ford-CATL Lithium Battery Agreement is being cited as a possible model for future partnerships.

• Focus on Nonsensitive Areas: The investment would be welcome in sectors considered low risk, but this would require softening the narrative of "Chinese threat" in the US.

• U.S. Demands: American representatives emphasized market access, managed trade and reciprocity.

• China’s Concerns: Chinese authorities raised doubts about the protection of their investments due to increased US scrutiny.

Despite the hope of politically viable trade victories during the summit, the scenario is of extreme uncertainty.

• Iran Factor: The recent US military attacks on Iran and Khamenei's death cast a shadow on the viability of these agreements.

• Diplomatic Frustration: Washington has not yet presented specific details of the Beijing agreements, which has caused frustration on both sides.

How this affects our graph of XAU/USD?

• Gold: A trade agreement between the two largest economies in the world could temporarily unscathe risk aversion. However, as long as the war in the Middle East persists, Gold will remain the dominant refuge asset.

• Dollar (DXY): Resumption of investments could stop the US capital leak that we saw in Goldman/EPFR data. If money goes back into US stock, DXY may find a short-term support.

• Actions: Sectors that rely on partnerships with China (such as technology and automotive) can have a relief rally if an official announcement takes place by the end of March.

We are facing a diplomacy of "bite and blow". Trump imposes global tariffs of 10% on one day and plans an investment visit on the other.

My Vision:

Trump's visit to China on March 31 will be the next big pivot on the market.

1. Metal Patience: Gold is trying to get back on top of the channel. Any sign of commercial peace can generate a pullback (correct) healthy up to our purple box from the analysis of the PREMIUM!

2. Focus on the news: New rounds of conversations are expected soon. Stay tuned for ExpertFX School notifications to capture leaks from these negotiations.

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