Countries should reach an agreement on a 90-day tariff suspension! US Treasury Secretary Bessent: Communication with Walmart is established, no need to worry about Moody's credit rating.

U.S. Treasury Secretary Scott Bessent warned global trading partners during an interview this morning on 5/19 that if no agreement is reached during the 90-day tariff suspension period, the Trump administration will revert to the previous “reciprocal standard.” Regarding Trump’s earlier request for Walmart to absorb the tariffs, and the issue of the three major U.S. rating agencies, Moody’s, downgrading U.S. credit ratings, Bessent stated that he has already spoken with the CEO of Walmart and asked them to absorb part of the tariffs, while some will be passed on to consumers. As for Moody’s downgrade, he believes it is not necessary to pay attention to it, as U.S. assets still hold considerable attractiveness.

Please reach an agreement during the 90-day tariff suspension period; if no agreement is reached, the previous “reciprocal” standards will be restored.

Besant emphasized:

“President Trump has called for sincerity in negotiations during the tariff suspension period. If unwilling, then revert to the standards of 4/2.”

Becent also mentioned that currently there are 18 important trading partners that the United States prioritizes for negotiation, but did not disclose a timetable for the negotiations.

Consider establishing regional programs for Central and South America and Africa to make negotiations more flexible.

Becent revealed that the United States is considering establishing regional tariff schemes for Central and South America and Africa, which means:

“Directly establish regional average tax rates.”

He emphasized that the negotiations would be more flexible and hoped to promote global trade stability without interfering with U.S. interests.

A notification letter will be issued within two to three weeks to inform countries around the world of the amount of customs duties to be paid.

Trump publicly stated at the UAE business roundtable meeting last week:

“About 150 countries around the world want to sign trade agreements with the United States, but due to time and manpower constraints, it is not possible to negotiate with each country one by one.”

It also pointed out that within the next two to three weeks, its financial team will send out notification letters to various countries:

“If you don’t sign the agreement, how much tax should be paid.”

For the adjustment and pressure on China, tariffs will be temporarily reduced from 145% to 30%. Bessent: “In order to adjust and apply pressure”

U.S. Trade Representative Jamieson Greer reached a preliminary consensus with Beisent on 5/13 in Geneva, Switzerland, with the Chinese trade delegation:

The tariffs on Chinese goods from the United States have temporarily decreased from 145% to 30%.

China also reduced tariffs on American goods from 125% to 10%.

But Besant also stated that this is just a temporary adjustment for these 90 days, and if no agreement is reached afterwards, it will be adjusted again.

The outside world criticizes the U.S. policy for being inconsistent and companies are complaining. Besant stated not to worry, this is a fog of war.

Regarding companies complaining about the unpredictability and frequent changes in policies, Besant explained that this is a deliberate ambiguity strategy we are employing. He stated:

“If we let each other know too much, they will play us at the negotiating table. But in the end, I believe that American consumers and workers will benefit from this.”

In response to Trump calling Walmart to eat tariff disputes, it was stated that discussions have been reached with the CEO.

Many American retailers relying on Chinese goods are worried that once high tariffs are reinstated, they will face skyrocketing costs and compressed profits. In this regard, the well-known American retailer Walmart (Walmart) has also publicly warned that the prices of certain products will increase as a result.

But after Trump learned of this news, he immediately stated:

“Walmart must absorb these tariffs together with China, and cannot let hardworking consumers foot the bill!”

In response, Besant stated that he has communicated with Walmart CEO Doug McMillon:

“Some tariffs are absorbed by Walmart, while the remainder may be reflected in product prices.”

Moody’s downgraded the U.S. credit rating to Aa1, and Besant stated that it doesn’t mind, as U.S. assets still have appeal.

In addition to the tariff issue, there are also warnings coming from the U.S. Treasury. The three major rating agencies, Moody’s, downgraded the U.S. sovereign credit rating from AAA to Aa1 on May 16. The reason is:

The federal debt of the United States has reached 36 trillion dollars and is still rapidly increasing.

One of the main reasons behind it is the ongoing debate in Congress over the budget proposal submitted by the White House, which is currently stalled.

The Committee for a Responsible Federal Budget (CRFB) estimates that if the latest tax cuts are extended for a full ten years, it could lead to an increase in the accumulation of the U.S. fiscal deficit by as much as $5.2 trillion.

In this regard, Besent stated:

“US assets remain attractive, unaffected by Moody’s downgrade.”

The downgrade in credit ratings may push up U.S. Treasury yields, affecting the costs of mortgages and corporate loans.

Experts point out that after the United States loses its top credit rating, the market may perceive an increased risk in lending to the US, leading to a rise in US bond yields.

The 10-year U.S. Treasury yield serves as a reference benchmark for pricing global financial contracts, directly affecting mortgage rates and corporate borrowing costs. If it rises, it could put pressure on the economy.

(Why was the credit rating of U.S. government bonds downgraded? What impact does it have on Taiwan, which holds a large amount of U.S. bonds? Research institutions explain clearly )

This article urges countries to reach an agreement on a 90-day tariff suspension! US Treasury Secretary Bessent: has communicated well with Walmart, no need to worry about Moody’s credit rating. First appeared in Chain News ABMedia.