After talks in Hawaii this week, China plans to step up purchases of American farm products in compliance with the stalled Phase 1 trade accord with the United States.
The globe's leading soybean importer plans to ramp up its acquisitions, everything from the very important farm commodity to ethanol and corn after purchases have fallen behind because of the global health crisis, sources with knowledge of the matter disclosed.
A separate individual said the government of China has asked state-owned buyers to make steps to follow the rules on the Phase 1 agreement.
The plan provides an intermission to markets that are worried about disruptions in trade after the two sides exchanged barbs over all types of things -- from the source of the virus to new security laws in Hong Kong.
According to Pompeo in a Thursday tweet, during his meeting with CCP Politburo member Yang Jiechi, "he recommitted to completing and honoring all of the obligations of the Phase 1 the trade deal between our two countries."
The US official did not offer any further information beyond the tweet, but it was the first essential development that emerged from the closed-door meeting with Yang at the US Hickam Air Force Base in Hawaii last Wednesday.
Michael Lorizio, senior trader at Manulife Asset Management in Boston, said that the news of the nice tone to the two countries' trade ties... is affecting Treasuries negatively, "so you are seeing the curve steepen from a selloff led by the back end of the curve," Karen Brettell of Reuters, wrote.
Benchmark 10-year notes were up four basis points to 0.731 percent, 30-year yields rose five basis points to 1.516 percent, and yield curve between two-year and 10-year notes climbed two basis points to 54 basis points.
The Chinese currency rallied on Friday following reports of Beijing's interest in speeding up its purchases of US farm goods, allaying concerns that a trade dispute between the world's biggest economies might resume again.
The Chinese yuan kept its steady pace during morning sessions as China's promise of extra economic push cushioned fresh threats from US President Donald Trump to cut relations with China after officials from the two sides conducted their first high-level discussions in months.
The onshore yuan advanced as much as 0.24 percent in afternoon trade after Bloomberg. It ended the local trading 0.16 percent higher at 7.0781 per US dollar but it remained generally unchanged for the week.