• The US Treasury Secretary Mnuchin confirmed China's commitments in the Phase-one trade deal.
• Beijing has not confirmed those purchase commitments, phase-two talks could lead to risk-off. 

The US Treasury Secretary Mnuchin has stated and confirmed that China's commitments in the Phase-one trade deal with the United States were not changed during a lengthy translation process and will be released this week as the document is signed in Washington. 

Mnuchin told Fox News Channel that the deal reached on December 13 still calls for China to buy $40 billion to $50 billion worth of US agricultural products annually and a total of $200 billion of US goods over two years.

US Treasury Secretary Mnuchin comments

"It wasn't changed in translation. I don't know where that rumor started," Mnuchin said on the "Sunday Morning Futures with Maria Bartiromo" show. "We have been going through a translation process that I think we said was really a technical issue," Mnuchin said. "And the language will be released this week. So I think it is -- the day of the signing, we will be releasing the English version." "And people can see. This is a very, very extensive agreement," he added.

Asked if he still expected China to purchase $40 billion to $50 billion in US farm products under the deal, Mnuchin said: "I do. Let me just say, it is $200 billion of additional products across the board over the next two years, and, specifically in agriculture, $40 billion to $50 billion."

Market implications

However, Reuters reports and notes that "thus far, Beijing has not confirmed those purchase commitments, and recent government actions in the agriculture industry have raised questions over the $40 billion to $50 billion target cited repeatedly by Trump administration officials."

All in all, a phase-one agreement will be good news for markets and brushing aside the troubles in the Middle East, for now,  its business as usual. However, considering that a phase-one deal signing is already priced in, it's not so clear how much further markets can reply on the fact. Also,  tariffs on about $370 billion worth of Chinese imports per year will still be left in place and will not be addressed until Phase-two of the negotiations, covering thornier issues untouched by the Phase 1 trade deal and for which are likely to spark up renewed tensions which could adversely impact markets, supporting risk-off currencies such as the yen and weigh on the Aussie.