Recently, the question of "Whether the United States will cancel some tariffs on Chinese goods" has been pushed into a wave of public opinion. There is also a heated discussion within the United States.

U.S. is considering resetting China tariffs

Recently, U.S. Treasury Secretary Janet Yellen said that the Biden administration is considering readjusting its approach to imposing tariffs on Chinese imports to ease decades of high inflation.

Yellen thought lower tariffs might be needed, adding: “It helps lower prices.” During the Trump administration, tariffs on certain Chinese imports were high.

Yellen told Congress that while tariffs are important to protect U.S. national security, exorbitant tariffs on certain Chinese imports will ultimately be passed on to U.S. consumers. It added that the Biden administration is looking to "reset these tariffs in a more strategic way."

At the same time, Yellen said that when the tariffs were first introduced, the epidemic had not yet begun, and inflation was at an annual rate of close to 2%.

Economists expect U.S. inflation to stabilize at an annualized rate of 8.3 percent in May, the highest in nearly 40 years. Despite low unemployment, rising prices for gasoline, groceries and other items have left many Americans feeling gloomy about the economic outlook.

Rep. Stephanie Murphy, Democrat of Florida, has introduced a bill that would require the U.S. Treasury Department to lead a study of the inflationary impact of tariffs, including tariffs on Chinese goods, steel, aluminum, solar panels, washing machines and other goods.

Inflation may decrease, RMB may rise sharply

A U.S. agency has released a study showing that the removal of a series of tariffs, including Chinese goods, could reduce U.S. inflation by 1.3 percentage points.

In this regard, U.S. Commerce Secretary Raimondo said that it may make sense to remove tariffs on household goods, bicycles, etc. The reason is that the United States has insufficient manufacturing capacity, and has been importing a large number of manufacturing products from China, ranging from microwave ovens, vacuum cleaners and other household appliances to other daily necessities, especially Chinese bicycles that Americans love to ride.

Raimondo also said that tariffs on steel industries such as steel and aluminum should remain in place. In fact, it is not just China. Since 2018, the United States has also imposed high tariffs on steel and aluminum imported from Europe, Asia and many other countries. In this regard, the United States said that the steel industry poses a national security risk.

In addition, the move by the United States to reduce tariffs will also affect the RMB exchange rate trend.

Goldman Sachs research shows that if the United States reduces tariffs on Chinese goods, trade revenue will be reduced by 18 billion US dollars. If all tariffs are removed, the RMB is expected to appreciate by 4.9%, which is equivalent to the lowest point this year or the current exchange rate. Around 3200 points.

Differences remain within the U.S.

In fact, there have always been differences within the Biden administration over the proposal to "cut China's import tariffs". The administration has been scrutinizing Trump-era tariffs for local legal requirements, and lower tariffs could take the form of an expanded list of exemptions.

Although US Treasury Secretary Yellen reiterated that such a high level of inflation is "unacceptable." But it also said that while cutting some tariffs might be justified and help lower some consumer prices, it would have a limited impact on U.S. headline inflation, which is already running at about 8 percent.

Because the bulk of consumer spending is on services such as dining out, education and health care.

In addition, when asked whether the White House will announce new trade measures against China soon, U.S. Trade Representative Dai Qi said that on the issue of trade with China, the United States should consider all aspects and take a long-term view.

In response to the American society's request to cancel tariffs on China to solve the current high inflation problem in the United States, Dai Qi said that fighting inflation is a more complicated problem, and it cannot be solved by "only focusing on" tariffs on Chinese products.