WASHINGTON (BLOOMBERG) - President Donald Trump's plan to ink a trade accord with Xi Jinping next month was thrown into question on Wednesday (Oct 30) after Chile canceled an upcoming summit where the two leaders planned to meet.
The cancellation - announced earlier on Wednesday by Chile as social unrest continued to rock Santiago - appeared to catch the White House off guard. It isn't yet clear whether US officials will look for an alternate venue to salvage the meeting with Xi or the broader Asia-Pacific Economic Cooperation summit.
"We're trying to get to the bottom of it," White House spokesman Hogan Gidley said.
The possibility of a Trump-Xi meeting in Santiago next month has buoyed markets as investors look for signs that an end to the multi-year trade war between the two nations is in sight. The White House was working as recently as Tuesday (Oct 29) to finish a "phase one" agreement with an eye toward the leaders signing it in Chile, according to a statement from White House spokesman Judd Deere.
The S&P 500 briefly fell to a session low after news of the meeting's cancellation.
"The risk here is that if the summit now is postponed then that at least suggests that the trade war uncertainty might be hanging over us for longer," Torsten Slok, chief economist at Deutsche Bank AG, said in an interview on Bloomberg Television on Wednesday.
"It raises the risk that we could never see a phase two or phase three and therefore the uncertainty would basically not be going away."
Trump and Vice President Mike Pence said last week they were optimistic the deal would be finalized at the summit.
Trump has previously hosted Xi at his Mar-a-Lago resort in Florida.