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Kudlow says there could be some 'positive surprises' out of next week's China trade talks

Key Points
  • "There could be positive surprises coming out of these talks," Kudlow said.  "I'm not predicting. I'm just saying don't rule that out. There could be some positive surprises."
  • Trade negotiators from the U.S. and China are set to resume trade negotiations on Oct.10 in Washington.
  • However, Kudlow said the U.S. strong support of Hong Kong's protests for democracy could have a negative impact on the talks.

White House economic advisor Larry Kudlow said Friday that "positive surprises" could emerge from the trade talks between the U.S. and China next week in Washington.

"There could be positive surprises coming out of these talks," Kudlow said in a interview with Bloomberg TV on Friday. "I'm not predicting. I'm just saying don't rule that out. There could be some positive surprises."

"Coming into this, China has been buying some commodities. A small amount, but perhaps a good sign," Kudlow said.

Trade negotiators from the U.S. and China are set to resume principal-level trade negotiations Thursday in Washington. Tensions have risen recently as reports revealed Trump administration officials are deliberating ways to limit U.S. investors' portfolio flows into China, including delisting Chinese companies from American stock exchanges. White House trade policy director Peter Navarro denied the reports however, calling them "fake news."

President Donald Trump on Thursday called on China to look into former Vice President Joe Biden, the front-runner for the 2020 Democratic presidential nomination, and his son Hunter, after House Democrats launched an impeachment probe into Trump last week.

"I haven't spoken to the president on that but it doesn't really sound like it's going to have much of an impact if anything on the China trade talks," Kudlow said of Trump's call for China to investigate the Bidens.

However, Kudlow said the strong U.S. support of Hong Kong's democracy protests could have a negative impact on the China trade talks.

"I do know we continue to monitor the Hong Kong freedom and democracy movement, which the U.S. supports very strongly. That could impinge the talks," Kudlow said.

Hundreds of thousands of protesters have taken to Hong Kong's streets since early June, originally in opposition to an extradition law that would have allowed fugitives in the city to be transferred to mainland China. The protests demonstrate discontent people appear to have with the city's government.