China and the US are working to end a standoff that has shaken financial markets, darkened the world economic outlook.

US President Donald Trump said on Thursday that the United States and China are “rounding the turn” in a lengthy negotiation over trade and predicted that “something monumental” and great for both countries could be announced in a matter of weeks.

“We are rounding the turn. We’ll see what happens,” Trump said during an Oval Office appearance with both countries’ negotiating teams. “We have a ways to go but not very far,” he added.

Vice Premier Liu He, China’s top trade negotiator, agreed, telling Trump that “because of your direct involvement, we do have great progress”.

China and the US are working to end a standoff that has shaken financial markets and darkened the outlook for the world economy.

Washington wants sweeping changes to China’s economic and trade policies, while Beijing wants Trump to lift expensive sanctions on Chinese goods.

US and Chinese negotiators on Wednesday began their ninth round of talks to resolve the dispute over US allegations that Beijing is using predatory tactics, including cyber-theft, in a campaign to challenge US technological dominance. China has denied the allegations.

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Trump has slapped tariffs on $250bn in Chinese products. In retaliation, China has targeted $110bn in US imports.

The president said on Thursday that he would discuss the future of tariffs the US has imposed on China with Liu.

The president also said he still wants to meet Chinese President Xi Jinping. “If we have a deal, then we’re going to have a summit,” Trump said.

Trump said he appreciated a “beautiful letter” he received from Xi, but he did not disclose its contents.

Military spending

Trump on Thursday lamented the amount of money that the US, China and Russia spend on weapons production, including nuclear weapons, and suggested that such money could be better spent elsewhere.

Trump, during his meeting with Liu, floated the idea of following up on a potential trade deal with China with a second-phase deal that addressed the issue of military spending and arms production.

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Asked by the president to weigh in on the suggestion, the vice premier said he thought it would be a good idea.

US Trade Representative Robert Lighthizer said there were still some major issues left to be resolved in the trade deal.

Trump said the sticking points included tariffs and intellectual property theft, and the president said he would discuss tariffs with Liu.