Overnight Finance: Trump eyes ‘different structure’ for China trade deal | Trump mulls auto import tariffs | Banks get green light to offer short-term loans

Happy Wednesday and welcome back to Overnight Finance, where we’ll never block any of our loyal readers. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

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THE BIG DEAL: President Trump on Wednesday said that a trade deal between the U.S. and China will likely take on a “different structure.”
“Our Trade Deal with China is moving along nicely,” the president tweeted, “but in the end we will probably have to use a different structure in that this will be too hard to get done and to verify results after completion.”

The tweet comes as the Trump administration and China seek a deal on trade following weeks of tensions, tariffs and sanctions between the two countries. The president did not make clear what a “different structure” would look like.

Negotiators from Washington and Beijing are looking to avoid a full-blown trade war between the world’s top two economies.

The Trump administration has backed off of threats to impose tariffs on $150 billion in Chinese products after Beijing said it would buy more American agricultural and energy products.

Read more here.

 

ON TAP TOMORROW:

• Consumer Financial Protection Bureau hosts its Spring 2018 meeting with its Community Bank Advisory Council, 9 a.m.
• Senate Banking Committee hearing entitled “Cybersecurity: Risks to the Financial Services Industry and Its Preparedness,” 10 a.m.

 

LEADING THE DAY

Trump mulling tariffs on auto imports: The Trump administration is mulling a plan to impose a fresh round of tariffs on imported vehicles over national security concerns, The Wall Street Journal reported on Wednesday.

President Trump is reportedly weighing whether to task the Commerce Department to investigate whether he can levy upward of 25 percent tariffs on imported automobiles under Section 232 of trade law. 

Trump has already imposed tariffs of 25 percent on steel and 10 percent on aluminum imports under the provision, which gives the president broad powers to slap duties on foreign goods that are considered a threat to national security.

 

India files WTO case against US over steel and aluminum tariffs: India on Wednesday requested World Trade Organization (WTO) dispute consultations with the United States over President Trump’s decision to impose steep duties on imported steel and aluminum.

The South Asian nation said it plans to impose additional duties on U.S. goods totaling $165.56 million, which they argue is the amount of trade affected by the duties of 25 percent on steel and 10 percent on aluminum.

The additional tariffs will be imposed on 20 tariff lines, which include chickpeas, cashews, walnuts and wheat, and are expected to be implemented before June 21 as long as the United States continues the steel and aluminum duties.

India said that the United States had so far declined their request for consultations on the metals tariffs.

The Hill’s Vicki Needham takes us inside the battle here.

US trade partners prep $3.45B in retaliatory tariffs: America’s trading partners are preparing retaliatory tariff measures for a total of $3.45 billion in revenue in response to recent U.S. trade moves.

It is a move that could soon impact U.S. farmers and manufacturers.

Bloomberg News reports that several U.S. trade partners, including the European Union, China, Russia, Japan, Turkey and India, have all announced plans for new retaliatory duties in response to recent U.S. policy.

The toughest response comes from the European Union, which announced $1.6 billion of additional levies this week, according to Bloomberg.

The Trump administration’s protectionist moves on trade have been met with resistance from a number of longtime U.S. trading partners, including European nations that have raised concerns about new U.S. tariffs on steel and aluminum. 

Read more here.

 

Regulator gives banks green light to offer short-term loans: The Office of the Comptroller of the Currency (OCC) on Wednesday pushed U.S. banks to offer short-term loans to customers with troubled credit histories, a practice shunned by the regulator five years ago.

The OCC announced a new policy on short-term, small-dollar loans Wednesday meant to encourage banks to compete in a space now dominated by storefront “payday” lenders with high interest rates.

The new guidelines reverse a 2013 Obama administration policy that instructed banks to avoid such loans over concerns that customers would be unable to pay them back and land in severe debt.

Comptroller of the Currency Joseph Otting, appointed by President Trump last year, said Wednesday that banks can offer safer options for customer that won’t land borrowers in cyclical debt.

“When banks offer products with reasonable pricing and repayment terms, consumers also benefit from other services that banks regularly provide, such as financial education and credit reporting,” said Otting, a former bank president.

I explain the new policy here.

 

Rubio: Floated ZTE demands are ‘a terrible deal’: Sen. Marco Rubio (R-Fla.) on Wednesday blasted a floated deal with Chinese telecommunications giant ZTE as “terrible” and warned the Trump administration against letting China steal U.S. intellectual property.

“Are you kidding me? $1.3 billion? And the other sanction, guess what it is? We’re going to force you to buy more things from America. Well, that’s not a punishment. That’s a reward. That’s exactly what they want. … That’s a terrible deal,” Rubio said from the Senate floor. 

Trump said on Tuesday that he had has not reached a deal with Beijing to help save ZTE, but added that he may ask for a fine of roughly $1.3 billion, new management for the telecom giant and for China to buy more American products.

But Rubio warned Trump against accepting a “short-term deal” that “historians will condemn as the beginning of the end of America’s place in the world as its most influential nation.”

Rubio also grilled the administration, his colleagues and the media during his floor speech for treating the trade developments with China as a “game.” 

Here’s more from The Hill’s Jordain Carney.

 

GOOD TO KNOW

• The Committee on Foreign Investment in the United States, the main vehicle for protecting American technology from foreign governments, rarely polices the various new avenues Chinese nationals use to secure access to American technology, according to Politico.
• About 40 percent of adult Americans would not be able to cover an unexpected $400 expense without selling a personal item or borrowing money, according to a new survey of U.S. households by the Federal Reserve.
• President Trump’s lawyer Michael Cohen was paid by Ukraine to arrange a meeting between the country’s president and Trump, the BBC reported Wednesday.
• Federal Reserve officials at their meeting earlier this month signaled they were likely to raise their benchmark short-term interest rate at their June meeting, and they debated how to characterize an evolving policy strategy that soon would no longer try to stimulate economic growth, according to the Wall Street Journal.
• Goldman Sachs made $200 million in profit on a single day this February as THE calm in stock markets was shattered with a historic surge in volatility, according to CNBC.

 

ODDS AND ENDS

• Netflix overtook Comcast in market value on Wednesday.
• A federal district court judge on Wednesday ruled that President Trump can’t block people from viewing his Twitter feed over their political views.