Amid intensifying global concerns over escalating trade tensions, U.S. President Donald Trump claimed in a TIME magazine interview that tariff negotiations with China were actively underway. Trump reiterated this to reporters before departing for Rome, asserting that Chinese President Xi Jinping had personally reached out to him.

However, China swiftly denied any such talks. The Chinese Foreign Ministry, via its U.S. Embassy, insisted that “no consultations or negotiations” were happening and urged the U.S. to “stop creating confusion.”

Speaking aboard Air Force One later, Trump suggested that forcing China to open its markets to U.S. products would be a major victory, although he cast doubt on whether he would even request it. “Free up China. Let us go in and work China,” he said. “That would be great.”

The conflicting statements only heightened the uncertainty surrounding Trump’s aggressive tariff strategy. Since returning to office in January, Trump has reignited a series of steep tariffs affecting dozens of countries, pushing foreign officials to Washington for urgent trade discussions during the IMF and World Bank meetings.

While Treasury Secretary Scott Bessent claimed signs of rapid progress, many global finance ministers, including Ireland’s Paschal Donohoe, expressed grave concerns about the mounting risks to jobs, growth, and living standards worldwide.

Hints of de-escalation emerged as China exempted certain U.S. pharmaceuticals from harsh tariffs and circulated a list of 131 product categories potentially eligible for tariff relief. Meanwhile, Trump indicated that a major deal with Japan could soon materialize, calling it a potential model for future bilateral agreements.

Despite these developments, economists warn that Trump’s sweeping tariffs — including a blanket 10% duty on all imports and targeted levies on steel, aluminum, and autos — could drive up U.S. consumer prices and push the economy toward recession. U.S. stocks, while posting a modest weekly gain, remain about 10% below levels seen before Trump’s return to office.

As negotiations continue, the global economy remains vulnerable, with IMF Managing Director Kristalina Georgieva cautioning that unresolved trade tensions could trigger a severe global slowdown.