KEY POINTS
  • Goldman Sachs economists say it's a close call, but trade talks between the U.S. and China could fail before negotiators reach the finishing line.
  • Tariffs are beginning to take their toll and show up as the biggest U.S. trade deficit with China ever, in the month of October.
  • Importers have front-loaded orders ahead of tariffs in the past, and that could start to happen in January and February as companies look ahead to the March 1 deadline, when tariffs on $200 billion in Chinese goods rise to 25 percent from 10 percent.
President Donald Trump (L) and Chinese President Xi Jinping walk together at the Mar-a-Lago estate in West Palm Beach, Florida, April 7, 2017.

Goldman Sachs economists said it's more likely than not that U.S.-China trade negotiators will not reach a deal in time to head off higher tariffs on March 1, and importers could rush to order their goods in January and February ahead of the deadline.

President Donald Trump and Chinese President Xi Jinping agreed to hold off on further tariffs until March 1 so the two sides could negotiate a trade agreement. China also agreed to remove new auto tariffs on U.S. imports, and Washington reported that Beijing is fulfilling another promise to purchase American soybeans, with its first significant order in six months, amounting to 1.13 million tons.