IMF's Lagarde Expects U.S. and China to Reach Trade Deal
BEVERLY HILLS, Calif. (Reuters) - International Monetary Fund Managing Director Christine Lagarde said on Monday she expects the United States and China to reach a deal to end their trade dispute, which has unnerved financial markets and cast a shadow over the global economy.
"I would say 'Yes'," Lagarde said at the Milken Institute Global Conference when asked whether talks between the world's two largest economies would end in a deal.
Washington and Beijing have been engaged for the past year in a trade war marked by tariffs on billions of dollars in goods and threats of escalation. The talks are now at a critical point.
U.S. Treasury Secretary Steven Mnuchin was scheduled to speak at the conference on Monday but is headed to China instead for talks.
Lagarde was the first speaker at the annual Milken Institute's conference, which draws 4,000 attendees including some of the world's most powerful thinkers and trendsetters to discuss finance, health care and other topics.
Other speakers during the three-day conference include the chiefs of financial powerhouses Goldman Sachs, Blackstone Group, State Street Corp as well as top investors including Steven A. Cohen, Thomas Barrack and Ken Griffin and prominent pension funds and endowments.
In a wide-ranging interview, Lagarde said she does not see the U.S. economy dipping into a recession in the wake of last week's news that it grew at a stronger-than-expected 3.2 percent annualized pace in the first three months of 2019.
Concerns have been mounting over a global slowdown, particularly in China and Europe, and the prospect that the decade-long U.S. bull market might be coming to an end.
But the strong U.S. GDP growth data may prompt leaders to reassess the health of the economy, she said. Lagarde cautioned, however, that more data is necessary before making a more definite call.
Even as inflation has been largely in check, a situation she called "highly mysterious," Lagarde said she expects price pressures to pick up "gradually and slowly" in the coming months, in part fueled by rising oil prices.
When asked whether she would like to continue as IMF chief when her current term is up in 2021, Lagarde said, "I'm looking at my options." The former French politician was named IMF chief in 2011.
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