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US, China expected to hold in-person trade talks next week

US Trade Representative Robert Lighthizer and Chinese Vice Premier Liu He at the Diaoyutai State Guesthouse in Beijing on Feb. 15, 2019

Mark Schiefelbein | AFP | Getty Images

American trade negotiators will soon head to China for face-to-face talks as the world's two largest economies try to strike a deal, sources told CNBC. Officials will travel to China for talks sometime between Friday – the start of a six-week congressional recess in Washington ̵

1; and Thursday, August 1.

While talks represent a critical next step after a truce reached between the countries' leaders in June, and the deal is not seen as near. President Donald Trump has signaled that he would be willing to relax restrictions on China's Huawei in exchange for purchases of the United States agricultural products.

Longer-term, U.S. Officials have suggested that they could roll back the tariffs in exchange for Beijing making the deal legally binding –

White House officials are now suggesting that getting China to agree to the latter could take several months at least, even though Trump remains inclined to ink and eventual deal, according to three people familiar with the matter

Meanwhile, the administration could shift its focus to ratifying the United States-Mexico-Canada Agreement. Trump sees his approval of his replacement for the North American Free Trade Agreement as a major economic and political priority.

U.S. Trade Representative Robert Lighthizer is using the remaining days of the congress session to meet with lawmakers about the deal. CNBC has reported that the White House is expected to send implementing legislation to Capitol Hill in September, setting up a vote on the deal this fall

Investors have watched the China talks closely. A widening trade war between Washington and Beijing would risk more damage to American companies and the global economy.

The Trump administration has set tariffs on $ 250 billion in Chinese goods – and has threatened to put duties on even more products. Beijing has slapped tariffs on $ 110 billion in American goods.

Both the U.S. and China have taken steps to deescalate tension in recent days. Trump agreed to make "timely" decisions about whether to allow American tech companies to sell to blacklisted Chinese firm Huawei.

Meanwhile, Chinese state media reported that China had taken steps to start following on its promise to buy more US agricultural goods. Trump sees the step as important to reaching an agreement as American farmers take a hit from tariffs on crops.

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