After Trump’s ‘opening salvo’, will he put the brakes on bigger tariffs on China?

Tensions between the world’s two largest economies appear controlled after Donald Trump’s return to the White House, belying months of anti-China bluster from the new US leader.

Three days ahead of his January 20 inauguration, Trump had a phone call with Chinese President Xi Jinping to discuss issues including fentanyl and trade, an exchange he described as “very good”. He also reportedly plans to visit China.

After taking office, Trump also held back on immediately imposing tariffs on China as earlier threatened.

However, that relative calm was short-lived and both countries are now throwing punches that are mounting to a trade dispute.

According to diplomatic observers, Trump’s emerging strategy towards China appears to involve the threat of tariffs to hammer out a deal.

But if that gambit were to fail, Trump would push ahead with higher tariffs, and that is when China would give up “playing defence” and strike back, the observers said.